Hotel deal shows CBD property buy was ‘justified’
Former mayor Andrew King says news of a big hotel deal for Hamilton’s CBD shows the council’s purchase of four properties on Victoria St for above “market value” on his watch was justified.
King’s comment on Thursday followed the announcement of a conditional deal between the council and Auckland-headquartered Templeton Group to build a a four-star hotel at least 10 stories high on some of the properties.
They were part of the 2018 purchase by the council of 242-266 Victoria St.
There was some controversy because the price paid was just under $6.5 million when the properties had an estimated market value of $4.3 million. The new proposed deal involves Templeton buying from 242254 Victoria St at what is set to provide a profit to the council.
From 260-266 Victoria St is due to be retained by the city and developed into a public space, extending Victoria on the River, with Templeton’s help.
The Templeton deal is being hailed as a major win for the city, although the company still has up to a year to complete various matters before the agreement can go unconditional.
Asked on Thursday whether the announcement made him feel vindicated about helping steer through the 2018 purchases, King said: “I was very justified in the purchase of that land at that time.
“The criticism [then] was politically motivated and I’m not concerned about that. It was always going to be in the best interest of the future generations of the people of our city to open that area up to the river.”
King said the land purchase was specifically designed for that opening up purpose. It followed the go ahead for the Victoria on the River development which he supported as a councillor under then mayor Julie Hardaker.
Lack of access to the river had been a common complaint from politicians and Hamiltonians for decades, King said.
On Wednesday, the potential “significant” profit from selling some of the properties as part of the Templeton deal was revealed by economic development committee chairperson Ewan Wilson.
At the time of the 2018 purchases, King said in a council statement that the vendors of the properties approached the council with a willingness to sell the sites – an opportunity the council could not let pass by.
“I’m delighted these purchases will help progress my dream of opening up central Hamilton to the Waikato River for the longterm benefit of our city and its residents,” King said at the time.
The four buildings on the five properties had, at the time, an estimated current market value of $4.3 million, the statement said. The council paid $6.49 million for the properties – less than the $7 million which had been budgeted for the purchases.
King said in the 2018 statement that Hamilton’s central city property market remained buoyant. Had another party purchased the properties, it was likely they too would have paid similar, or the same, prices as the council had.
“These are prime properties on our main street and I expect, if they had been marketed, they would have fetched similar prices to what the council has paid.”