Progress required a block

An artist's impression of the Esk St entry to Invercargill's proposed new CBD precinct. Image:...
An artist's impression of the Esk St entry to Invercargill's proposed new CBD precinct. Image: Supplied
After years of languishing, Invercargill's CBD is in line for an upgrade. A few good men, with city council support, have big plans for a large new shopping centre smack in the middle of the city. Logan SAvory finds out what they hope such a massive investment will achieve. 

Scott O'Donnell is embarrassed by Invercargill's CBD.

In fact, he has been for some time.

Scott O'Donnell
Scott O'Donnell
Mr O'Donnell does not want a situation where his children have that same embarrassed feeling as they grow old in Invercargill.

He wants to provide "the young and the smart" with a place they want to come back to.

There were jobs in Invercargill, but nothing to inspire young people to return, he said.

Mr O'Donnell is a proud Southland lad.

Of course, let us not be mistaken.

As well as the disappointment with the current state of Invercargill's CBD, and the desire to play a role in changing that, potential commercial opportunities also flutter away in Mr O'Donnell's mind.

His wife Jocelyn is the daughter of the late Bill Richardson, an understated businessman who grew his transport operation from nothing to one of New Zealand's largest transport companies.

An artist's impression of the inside of the proposed food court in the planned new Invercargill...
An artist's impression of the inside of the proposed food court in the planned new Invercargill CBD development. Image: Supplied
Mr Richardson's legacy lives on through Bill Richardson Transport World, a popular Invercargill attraction.

From 2006 through to 2015, Mr O'Donnell was the managing director of the HW Richardson Group, an organisation which now has its fingers in many different business pies.

Inner-city property had been on Scott and Jocelyn O'Donnell's mind for a while.

Mrs O'Donnell's involvement with the Southland Regional Development Strategy project fuelled the enthusiasm.

It was in 2015, when Mr O'Donnell retired as Richardson Group managing director, that it all started to get serious.

The starting point was buying the old Outdoor World building on the north side of Tay St - the site where Motorcycle Mecca is now situated.

Lindsay Thomas
Lindsay Thomas
However, that was not the initial plan.

"We brought that as a punt because we thought that is what Invercargill needed," Mr O'Donnell said.

"We thought we would buy that as an agent for the council, even though we never talked to council about it, because we thought that would be a great spot for the Invercargill museum. To get it back into the CBD.

"The assumption was we would demolish that [Tay St] strip and start again.

"Council were going to lease [the former Outdoor World] as an inner-city art gallery, but they couldn't get the funding for it."

At the same time the HW Richardson Group brought a motorcycle collection from Nelson.

It was decided the old Outdoor World building would in fact provide an ideal location for the collection to be displayed.

The sights then turned to the block across the road, a block where a $200 million "retail precinct" is now planned to be built.

Bit by bit the Richardson Group started to buy buildings in that block.

"We had bought some bits and bobs. We had been flopping around the market mopping up some stuff because people couldn't give it away. We were picking up some stuff for future needs really."

Eventually, Mr O'Donnell initiated discussions with the Invercargill City Council to investigate whether there was any interest in teaming up to get the entire block purchased and "revitalise the heart of Invercargill".

"We talked to the councillors and said, `Look guys, if we are going to get ahead here we are going to have to work together and get an outcome'," Mr O'Donnell said.

As a result, HWCP Management Ltd was formed.

An artist's impression of the Richardson Group's planned new office building on the corner of Esk...
An artist's impression of the Richardson Group's planned new office building on the corner of Esk and Dee Sts as part of the proposed CBD redevelopment. Image: Supplied
The company is a joint venture between HW Richardson Group's HWR Property Ltd, and Invercargill City Council's Invercargill City Property Ltd.

The shares are split 50-50.

Mr O'Donnell was joined by long-time Invercargill property developer and hotelier Geoff Thompson and Invercargill city councillor Lindsay Thomas as the three directors of the company.

"When we started to work with council we chucked in all the buildings we had in that block, they chucked in some capital to match that, and lent some more money to the joint venture to go and buy some more," Mr O'Donnell said.

CR THOMAS believes the CBD development is a project the council needs to be involved with.

"It's important for the growth of the city.

"Apart from just the fact the CBD is in desperate need of sorting, all those buildings are shagged.

"By not doing anything we would be exposing people to risk. Some of them are less than 15% [of the earthquake standard]."

He said the council's involvement from the start had always centred on helping buy all the land in the CBD block.

The actual build was up to commercial investors and that had not changed, Cr Thomas said.

Invercargill Mayor Tim Shadbolt believed it worked well having council team up with the private sector to get a CBD block development of this scale started.

"We bring different skills."

He acknowledged a project like this would create debate, both in terms of the council's financial involvement and the balance between restoring Invercargill's heritage and modernising the city.

"There are risks with a project like this, but there are also risks in not doing anything. We don't want to stagnate," he said.

He felt the city had had some success during the past couple of decades, through the Southern Institute of Technology's Zero Fees scheme, events like the Burt Munro Challenge, and the construction of community venues like Stadium Southland.

The CBD development was the next step.

ALL up, about 15 individual transactions were required to buy the entire block where the retail precinct is planned.

It provided some challenges.

Much of it hung on whether the group could convince an English-based group, which included the Dowager Duchess of Bedford, to sell what it owned in the block.

The group owned the Cambridge Arcade, the car park in the middle of the block, and the old Media Works building on the corner of Kelvin and Tay Sts.

"Unless we got that block of land that the Duchess owned, it was game over. So, we basically paid them what they paid for it," Mr O'Donnell said.

"It wasn't easy because I made a couple offers and they kind of laughed, but the offers were supported by an evaluation. So, if a party doesn't need to sell it is very hard to force them to sell."

The sale did happen.

Mr O'Donnell and his HWCP Management Ltd company, outside a couple of buildings, got the lot.

THE focus then switched to the plans.

In short, the planned CBD precinct would include a covered car park for up to 1000 cars, a boutique eatery, retail shops ranging from an anchor retailer to smaller stores, a medical centre, offices, and apartments.

While plenty has happened, Mr O'Donnell knows too well there was now even more to be done to turn the CBD dream into a reality.

"We can't turn back, we've got to get on with it and get it done," he said, not wavering about the project.

Earlier this month HWCP Management Ltd handed a draft of the resource consent application to the Invercargill City Council to look over - all 1780 pages of it.

It came at a cost of close to $500 a page, Mr O'Donnell pointed out.

The hope was for resource consent to be approved by Christmas and demolition to start early next year.

"The key thing now is to get the key tenants signed up, there is a fair bit of work going on with that. Also how we can build it, and how we can fund it."

How it is funded remains paramount.

HWCP Management Ltd is on the hunt for investors.

Geoff Thomson, Community Trust of Southland, the Government through the Provincial Growth Fund, and Ngai Tahu have all been identified as possible potential investors.

The council also remained on the radar.

Mr O'Donnell felt it was time the council did invest in a wider CBD overhaul.

"I'm not saying the council should pay for it all, but show some leadership by saying, `right, we want to see these things done. Let's adjust our district plan to say this is the way forward, and start to work with funding partners to work out a way to make it happen'."

There was enough capital in Invercargill to ensure a vibrant wider CBD was in place, "instead of hoarding it for a rainy day", Mr O'Donnell said.

"It is raining now.

"We have got so many public funds floating around this town, but they are just not being used effectively, in my opinion.

"We have got roughly $120million in equity in [Invercargill City Council's] Holdco, and you've got to start asking the question whether that capital is being used for the best efforts of the ratepayers of Invercargill."

 

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