High-country land prices inflated

The Government is driving up the price of high-country land by paying above market rates for whole property purchases as it fulfills its conservation and high country park goals.

• Government biggest high country buyer 

In the case of the recently purchased St James Station in North Canterbury, the Nature Heritage Fund paid $40 million, or $2500 a stock unit - four times its productive value as measured by comparable sales of high-country farms for pastoral use.

The Government denies it has paid excessive prices, increasing land values and therefore rents paid by lessees, saying that on a per-hectare basis it was paying market rates.

Farms are bought and sold on a per stock unit basis, and using that measure, sale figures obtained by the Otago Daily Times for recent sales of high-country farms, show that whole property purchases by the Government of St James, Birchwood, Landsborough, Twinburn and Tambrae stations all exceeded comparable prices for land remaining in pasturage.

The Government has bought those properties outright, paying from $960 to $2500 a stock unit, or $420 to $1694 a ha.

In the last two years, prices paid for pastoral lease high-country farms have ranged from $524 to $963 a stock unit.

The Department of Conservation's southern regional operation's manager, John Cumberpatch, said that on a per hectare basis it was paying market rates.

The Government agency, the Nature Heritage Fund, paid $420 a ha for the 23,783ha Birchwood Station and $511 for St James.

Mr Cumberpatch said Ryton Station at Lake Coleridge recently sold for $1610 a ha and would remain a working farm.

But sources have told the Otago Daily Times that those comparisons were not fair.

Just 13% of St James was grazed and much of the North Canterbury station was class 7 land, which had limited farming value and therefore would command a low per hectare price but high per stock unit price.

Ryton Station also had a significant area of freehold land.

Mr Cumberpatch said all sales were on a willing-seller willing-buyer basis.

The 78,196ha St James Station has been in the Stevenson family since 1927 and would gradually be phased out over the next two years, but as part of the sale agreement, the family can continue to use the homestead and two other homes at their discretion.

Farmers have long claimed the Government was driving up land values as it pursues its conservation aims, including a network of high-country parks, by paying above market rates for conservation and scenic values, something the Government denies.

The issue of non-pastoral values inflating the capital value of a pastoral lease despite lessees being unable to financially utilise those values, was the subject of a Land Valuation Tribunal hearing in Dunedin which ended this week.

In announcing the St James purchase, Conservation Minister Steve Chadwick hailed it as protecting the country's natural heritage, guaranteeing public access and protecting the land from intensive farming and development.

As of last year, the Government had opened five new high-country parks and was progressing another five through tenure review and whole property purchase.