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Manurewa Local
Board
10 September
2015
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Auckland
Council Property Limited Local Board Six-Monthly Update 1 January to 30 June
2015
File No.: CP2015/18985
Purpose
1. To give the Manurewa Local Board an overview of Auckland Council Property
Limited’s (ACPL) activities for the six months 1 January to 30 June 2015.
Executive Summary
2. In May 2015 the
Governing Body voted in favour of merging ACPL with Waterfront Auckland to form
Development Auckland (DA). The merger responds to feedback from the
wider council organisations and seeks to address some key growth, development,
housing provision and funding challenges that Auckland will face over the next
20 years. As a CCO Development Auckland will have a commercial orientation, but
it will also have explicit public good outcomes to pursue.
3. Substantive elements of the
purpose of DA relate to urban redevelopment, strategic advice on council’s
property portfolio and the redevelopment of underutilised council assets to
achieve commercial and strategic outcomes.
4. In August the governing body
will receive recommendations from council staff in respect of the proposed
locational priorities for DA.
5. It would be anticipated that DA
will specifically engage with local boards post the formal establishment on the
1 September to consider what activities DA can undertake to benefit their local
communities.
6. As this will be our final
six-monthly update to you as ACPL, we are including both the full business
summary as included in previous versions and additionally providing an outline
of some of the strategic and organisational changes we will be making as we
transition to Development Auckland.
7. ACPL activity detail is broken
down by business unit or work-stream, with a focus on local board specific
activities where applicable.
8. Local board specific supporting
detail is included in Attachments A, B and C.
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Recommendation/s
That the Manurewa Local Board:
a) accepts the Auckland Council
Property Limited Local Board Six-Monthly update 1 January to 30 June
2015.
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Comments
Development Auckland
9. Council formally approved the
establishment of Development Auckland, being a merger of Waterfront Auckland
and Auckland Council property Limited, in May 2015.
10. The essential
purpose of DA is to contribute to the implementation of the Auckland Plan and
encourage economic development by facilitating urban redevelopment that
optimises and integrates good public transport outcomes, efficient and
sustainable infrastructure and quality public services and amenities. DA will
manage council’s non-service property portfolio and provide strategic advice on
council’s other property portfolios. It will recycle or redevelop sub-optimal
or underutilised council assets and aim to achieve an overall balance of
commercial and strategic outcomes.
11. A number of
objectives fall within the purpose including facilitating the redevelopment of
urban locations and optimising the council’s property portfolio.
12. The process to
establish the operating structure of DA is well advanced and a combined work
stream between DA and council staff is looking at the future priorities for DA
that will provide focus in terms of geographic locations and project
priorities. In respect of the locational analysis work recommendations will be
made to the governing body in August.
13. It would be
anticipated that DA will specifically engage with Local Boards post the formal
establishment on the 1 September to consider what activities DA can undertake
to benefit their local communities.
Workshops and Meetings
14. A schedule of
Manurewa Local Board workshops and meetings attended by ACPL representatives
from January to June 2015 is included as Attachment A. The list
includes property specific meetings and workshops relating to general property
management and the ongoing portfolio Rationalisation Process.
Property Portfolio Management
15. ACPL manages
property owned by the council and AT that are not currently required for
service or infrastructure purposes. These are properties that are not
immediately required for service delivery or infrastructure development but are
being held for use in a planned future project such as road
construction/widening or the expansion of parks. This work will largely remain
unaffected by the transition to Development Auckland.
16. The property
portfolio continued to grow during the last six months and now totals 1347
properties containing 1080 leases, an increase of 41 since our July-December
2014 update. The current property portfolio includes industrial sites and
buildings, retail tenancies, cafés, restaurants, offices and a substantial
portfolio of residential properties.
17. ACPL’s return
on the property portfolio for the year ending 30 June 2015 provides the
shareholder a net surplus of $ 6.8m ahead of budget, with an actual surplus of
$ 29.8 m against budget of $ 23m. The average monthly vacancy rate for the
period is 1.6% which is under the Statement of Intent (SOI) targets of 5%.
18. A Properties
Managed schedule is included as Attachment B of this report. The
schedule details:
§ Current ACPL-managed commercial and
residential property within the Manurewa Local
Board
§ Each property’s classification or reason
for retention
§ The nature of the property, such as a
café within a library, or a residential property with a tenancy in place
§ The budget under which operating
expenditure and lease revenue for the property is reported eg regional or local
board.
19. A report
indicating portfolio movement in the local board area is attached as Attachment
C. The report details all new acquisitions including the reason for
acquisition, any transfers and the reason for transfer, and any disposals.
Portfolio Review and Rationalisation
Overview
20. ACPL is
required to undertake ongoing rationalisation of the council’s non-service
assets. This includes identifying properties from within council’s portfolio
that may be suitable for potential sale and development if appropriate. ACPL
has a particular focus on achieving housing outcomes. Identifying potential
sale properties contributes to the Auckland Plan focus of accommodating the
significant growth projected for the region over the coming decades, by
providing the council with an efficient use of capital and prioritisation of
funds to achieve its activities and projects.
Performance
21. July 2014
to June 2015 Target
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UNIT
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TARGET
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ACHIEVED
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COMMENTS
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Portfolio Review
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$30m disposal recommendations
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$69m
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These recommendations include
$65.9m of sites that are identified for development projects.
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22. In setting
future disposal targets ACPL is working closely with the council and AT to
identify potentially surplus properties.
23. 2014/2015
Targets
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UNIT
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TARGET
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COMMENTS
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Portfolio Review
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$30m gross value recommended for sale
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These targets include disposal
recommendations and sales for sites that are identified for place-shaping and
housing development projects
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Development & Disposals
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$30 net value of unconditional sales
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Process
24. Once
identified as a potential sale candidate a property is taken through a
multi-stage Rationalisation Process. The agreed process includes engagement
with: the council, CCOs, local board and mana whenua. This is followed by ACPL
Board approval, engagement with local ward and the Independent Māori
Statutory Board and finally a governing body decision.
Under
review
25. Properties
currently under review for future use opportunities via the Rationalisation
Process in the Manurewa Local Board area are
listed below. The list includes any properties that may have recently been
presented to the governing body and either approved for sale or development and
sale or designated for retention. Further details are included in Attachment
B.
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PROPERTY
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DETAILS
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20 Mcannalley
Street, Manurewa East
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Presented to
committee on 7 March 2013. Decision deferred pending further discussion with
local board. On 15 August 2013 Manurewa Local Board resolved to recommend the
property for sale with additional recommendation to the Ministry of Education
that they consider land purchase as part of the Ministry of Education, Early
Childhood Education, TAP Scheme Funding for groups or organisations applying
for such. The site was re-presented to the Governing Body for decision in
August 2014 and cleared for sale. Sold in March 2015, settled April 2015.
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75 Waimahia
Avenue, Weymouth
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Vacant section on
foreshore of Weymouth- linkage to reserve at rear. Cleared for sale by
governing body in May 14. Now preparing for sale.
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18D & 22D
Walpole Avenue, Manurewa
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Partial section.
Transferred from ACPD to non-service in September 2013. No current use or
potential use as access to rear properties (49D Scenic Drive, 18D & 22D
Walpole Ave). The Rationalisation Process for this property commenced in June
2014. No alternative service uses were identified. Presented to
the Governing Body on 20 August 2015 and cleared for sale.
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49D Scenic Drive,
Manurewa
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Partial section.
Transferred from ACPD to non-service in September 2013. No current use or
potential use as access to rear properties (49D Scenic Drive, 18D & 22D
Walpole Ave). The Rationalisation Process for this property commenced in June
2014. No alternative service uses were identified. Presented to
the Governing Body on 20 August 2015 and cleared for sale.
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Redevelopment/Regeneration and Housing Supply
initiatives
Overview
26. ACPL in its
current form is contributing commercial input into approximately 54 region wide
council-driven regeneration and housing supply initiatives. Involvement extends
from provision of initial feasibility advice through to implementation, with
projects ranging in size from $415k to in excess of $100million.
27. ACPL is also
actively contributing to the Housing Action Plan, which is a council initiative
focusing on non-regulatory efforts to encourage and increase affordable
residential development. ACPL has an SOI target to undertake five housing
development projects over three years that will improve housing affordability
and the supply of affordable housing encompassing CHO involvement. ACPL is
currently actively working on 13 such projects.
28. In our
expanded role as Development Auckland we will be extending on this work to play
a much stronger role in urban development through greater scale, enhanced
capability and the ability to partner with others. We will have a key role in
helping deliver the council priority of quality urban living and will have the
mandate to deal with the challenge of Auckland’s rapid growth through
regeneration and investment.
29. Development
Auckland’s roles and responsibilities will be customised to each specific
project initiative and location. A few will be of a high custodial nature
associated with urban regeneration. Some will be at the other end of the scale
with a more facilitative role; and some will be much more able to be delivered
in the short term.
30. ACPL already
works closely with the local boards on ACPL-led developments to ensure we give
effect to the local boards’ place-shaping role. As Development Auckland
engagement will in some areas be of a much broader scope, with the potential
for involvement in master-planning activities for significant land areas.
Optimisation Update
31. Optimisation is a programme of work aimed
to achieve better use of council’s planned and funded service assets. The
programme targets housing and urban regeneration outcomes along with the
delivery of cost-neutral service investment on appropriate sites. ACPL
and ACPD are leading a cross-council project to establish the rules and
methodology for service optimisation activity. The programme will be carried
across to Development Auckland.
32. Local board
engagement and workshops will be provided to demonstrate the scope of
optimisation and the benefits of driving optimal asset performance from
qualifying service property. Timeframes for these workshops have been
pushed out due to Development Auckland transition work. However
ACPL welcomes suggestions of service sites that may have potential for improved
service function along with housing or urban regeneration outcomes
Local Activities
33. A high level
update on place-shaping and housing initiative and proposal activities in the
Manurewa area is outlined in points below.
34. 20
Barrowcliffe Place, Manukau: This approximately 5 ha site on the southern
side of the South Western Motorway was transferred from ACPD
as non-service in March 2014 and has been evaluated for potential residential
development. ACPL commenced the Rationalisation Process in April 2014. No
alternative service uses were identified. The property was presented to the
Governing Body in September 2014 and approved for disposal and development.
35. ACPL is expecting
individual title to the land to be available in October. Intensive terraced
housing is currently being proposed with a view toward providing 145 terraced
houses on the site.
Acquisitions
Overview
36. ACPL continues
to support council and AT programmes and projects by negotiating required
property acquisitions. All such acquisitions are funded through approved
council or AT budgets. We also provide advice to assist with budgets, business
cases and strategy to support an acquisition.
37. From 1 January
2015 to 31 June 2015, 49 property purchases were completed for the council and
AT. All of the property acquisitions met independent valuation thresholds
agreed with AT, the council and Public Works Act 1981 requirements.
Council Acquisitions
38. Of the 49
property acquisitions over the past six months, 12 were purchased to meet
council legal, open space and storm water requirements and to contribute to
City Transformation projects. These included the following acquisitions in or
neighbouring the Manurewa Local Board area.
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PROPERTY
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STAKEHOLDER
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WORK TYPE
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LOCAL BOARD
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398S Weymouth Road, Weymouth
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Community Policy & Planning
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Open Space
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Manurewa
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84 Cosgrave Road, Papakura
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Storm Water
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Storm Water
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Papakura
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Auckland Transport Acquisitions
39. The remaining
37 properties were acquired on behalf of AT. The focus was on acquisitions to
support major transport projects including AMETI (five acquisitions) City Rail
Link Property Acquisition (seven acquisitions), Redoubt Road Mill Road Corridor
Upgrade (six acquisitions) road widening across the region (10 acquisitions)
and Northern Strategic Growth Area (one acquisition). Full details of relevant
AT projects and associated acquisitions will come to the local board directly
from AT.
Business Interests
40. ACPL also
optimises the commercial return from assets it manages on council’s behalf.
This comprises two forestry enterprises, two landfills and four quarries. There
are currently no ACPL managed business interests in the Manurewa Local Board
area.
Consideration
Local Board Views and Implications
41. This report is
for the Manurewa Local Board’s information.
Māori Impact Statement
42. Whatungarongaro te tangata, toitū te whenua. The importance of
effective communication and engagement with Māori on the subject of land
is understood. ACPL has accordingly developed robust engagement with the 19
mana whenua groups for our core business activities. We are currently working
with Waterfront Auckland on a future strategy for Development Auckland.
43. Key engagement activities currently include: identifying
cultural significance concerns regarding disposal properties, flagging
commercial interests, development partnering discussions and issues relating to
property management such as protection of wāhi tapu or joint management
arising from the resolution of Treaty Settlements. ACPL also engages with
relevant mana whenua in respect of development outcomes for ACPL lead projects
where appropriate. As Development Auckland we will work with iwi to consolidate
and build on strengths from ACPL and Waterfront Auckland’s approaches along
with successful work being done elsewhere in the council family.
44. ACPL additionally
undertook to be part of council’s Māori Responsiveness Plan (MRP) pilot
programme. The project’s key output is an operational document outlining ACPL’s
contribution to council’s strategic and operational commitments to Māori.
The MRP was finalised and approved by the ACPL Board in December 2014 and is in
the implementation phase. A copy of this is available on the ACPL website. This
work will be carried over and reflected in the new organisation.
45. As we
transition to Development Auckland, the local board can expect to be advised or
involved as appropriate in any discussions that arise in the local board’s
area.
Implementation
46. There are no implementation
issues.
Attachments
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No.
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Title
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Page
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aView
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Schedule of meetings and workshops
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13
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bView
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Properties Managed by ACPL in the Local Board area
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15
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cView
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Property movement in the Local Board area
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17
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Signatories
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Author
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Caitlin Borgfeldt - Local Board
Liaison
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Authoriser
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David Rankin - Chief Executive
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