Call centre for former RSA?

Neil Jorgensen.
Neil Jorgensen.
The Waitaki District Council yesterday approved a start to negotiations with a possible tenant for the vacant former North Otago Returned and Services Association (RSA) building in Itchen St, Oamaru.

Councillors voted in favour of a $4million expansion and upgrade of the 1951 council-owned building on the condition a 10-year lease is signed with an unnamed commercial tenant.

Council assets manager Neil Jorgensen said while the council had not called for expressions of interest for the building it had been approached ''pro-actively'' by one interested party after the council took over the building in 2015 after the dissolution of the North Otago RSA.

''There could well be better [tenants] out there,'' Mr Jorgensen said yesterday. ''There is an option out there right now. Will we take it?''

He said yesterday's ''strategic level'' decision was necessary because further delays in the negotiations could scuttle a possible deal and the council now knew the deal ''can work financially''.

Cr Peter Garvan, who championed the redevelopment yesterday, said he was ''absolutely thrilled'' by the support for the project from other councillors in the room and he further characterised concerns raised by several councillors about taking on risk as a property developer without assurances of a market return on investment, as ''premature''.

While the council has agreed not to name the prospective tenant while negotiations are under way, a non-notified resource consent decision provided by the council to the Otago Daily Times this week shows how the redevelopment would occur to allow the site's use as a 24-hour call centre.

Mr Jorgensen said the council had received assurances from the company it was committed to Oamaru, allowing for the required 10-year lease period.

The largest call centre provider in Oamaru, Trustpower, employs 101 people, predominantly call centre staff, in an office in Lower Thames St. The company has stated publicly it ''is in conversation'' with the council about its future, but has also said ''Trustpower has made no decision to date''.

In a public-excluded meeting following yesterday's council meeting, councillors discussed details of the lease, but in the public council meeting, several councillors voiced concerns about the conditions required for its negotiation.

Cr Hugh Perkins questioned the condition that the endowment, or reserve, funds used for the redevelopment provide only an ''equal or better'' return than the 4% they now earn for the council.

He also asked for added certainty to the condition that the investment was ''expected to improve over time''.

hamish.maclean@odt.co.nz

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