On Thursday, the Queenstown Lakes District Council voted to approve proposed development objectives for the 4.4ha site, once pegged for a convention centre, and agree to a "transaction approach" to engage with the market and select a development partner.
In doing so, it also agreed to consult the community first.
Council strategic projects manager Paul Speedy’s report said the commercial land was underperforming and was attractive to interested investment parties.
Sale of the commercial land, or "selling" development rights, offered an opportunity for the council to meet current and future needs of the community through provision of infrastructure and services.
Mr Speedy said the transaction approach would allow the council to have a "first look" at who the development partner might be and make sure it was the right match.
The process would not remove council control, he said.If it was ultimately agreed to, expressions of interest would be sought and then shortlisted.
Before the council went back to shortlisted parties, it could prescribe outcomes in its request for proposal process.
"This is the first step in terms of engaging the market and getting them around the table," he said.
There was ‘‘80,000sq m’’ of building space on the site, which could result in 1000 hotel rooms or the same number of apartments.
"Whatever we decide to make, we need to ensure we get the best financial outcome."
On its website, the council says it has taken a "fresh look" at the potential of the freehold land.
Present market conditions and Plan Change 50 — Queenstown Town Centre Zone Extension meant now was an "optimal time" to consider taking the commercial land to market and achieve best value for ratepayers.
A "major investment challenge" was ahead in terms of potential development opportunities and the required infrastructure investment to meet growth.
"The Lakeview commercial land potentially unlocks an important contribution and also forms an important part of the development of the wider town centre.
"While it is critical that the council holds in reserve community-owned land for future generations, the Lakeview site is a key central site that remains underutilised."
Under PC50 the land could be developed as a range of small commercial, residential and visitor accommodation activities.
The council proposed to retain community ownership of parks and reserves on the site, including a proposed "market square". All up, including roading corridors, that would amount to about 6ha of land held by the council in perpetuity.
Public feedback closes at 5pm on September 8 before the matter goes back to the full council later next month.
