But the Queenstown Lakes District Council may have a claim on the land for a future road bypass.
Long-time Queenstown resident Lew Gdanitz and his business partner Victor Cheng, of Christchurch, are proposing the complex, designed by award-winning Arrowtown architect John Blair, on their 3000sq m site bordered by Stanley and Shotover Sts and Gorge Rd.
It is also adjacent to the main council offices.
Mr Gdanitz said the development would meet an increasing demand for more hotel rooms and retail space.
However, the proposal potentially challenges council roading and zoning policies.
Part of the site - occupied by car parks, apartments and offices - could be needed for a bypass between Melbourne, Henry and Man Sts to relieve CBD congestion. But the council agreed this year to delay the Henry-Man St link until at least 2040.
''Land owners should not be expected to wait 25 years to find out whether the council might want to take their land,'' Mr Gdanitz said.
He also noted the council, in its controversial plan change 50 proposal to extend the ''Queenstown town centre'' zone as far as Isle St and the Lakeview site, did not include their land, which was still zoned ''high-density residential''.
In his submission to the plan change, he said the site and others nearby ''present a much more logical and natural extension of the town centre than much of what is proposed''.
The council had also discussed rezoning the land ''town centre'' in planning documents in both 2009 and 2012, he said.
The site was ''right on the town centre boundary, it's got public car parking right beside it, it's got a lot of people walking past, it's on main roads and it's been used, including by the council, for commercial purposes already'', Mr Gdanitz said.
The former Queenstown Medical Centre had also been on the site.
In its district plan review last month, the council suggested rezoning part of the land ''town centre''.
''It just so happens that the exact boundary of the bit to be retained as `high-density residential' is exactly the land the council may wish to take by 2040 for the road link.''
The piece rezoned ''town centre'' was too small to be of any use, Mr Gdanitz said.
He stressed that his proposed development was not a ploy to get the council to buy the land.
Adam Feeley''They could knock down their own council chambers and put a road through there - that's a lot cheaper option than buying my land,'' Mr Gdanitz said.
Asked his reaction to the proposal, council chief executive Adam Feeley said he could not comment without prejudicing the application.
As for the bypass project, ''there are a number of possible options for rerouting traffic which includes a possible route alongside the Queenstown Memorial Centre.
''It's too early in that process to say which will be the preferred route or when it will happen.''
The council would consider a town centre transport strategy in the new year, Mr Feeley said.
Mr Gdanitz said the complex would comprise hotel rooms on the top two floors, 1200sq m of ground floor retail and an internal courtyard.
There would also be 52 underground car parks.
The complex would not affect neighbours' views, he said. - Mountain Scene
