Section Seven: Supporting Information

7.18 Proposals related to strategic assets

7.18 Proposals related to strategic assets

Heritage buildings in Takapuna and Devonport

Overview
Auckland Council continually reviews its assets to ensure they are fit for purpose and delivering best value to
Aucklanders. This includes reviewing surplus, non-service properties.
As part of this process two properties in Takapuna and Devonport were approved in principle for sale in July
2020, subject to the completion of statutory processes (including any statutory consultation requirements) as
they are no longer required by Auckland Council.

Consultation requirements
Under section 97 of the Local Government Act 2002 (LGA 2002), a decision to transfer ownership or control of a
strategic asset to or from a local authority must not be made unless the local authority has explicitly provided for
the decision in its 10-year Budget and consulted on the proposal through a consultation document in
accordance with section 93E.
Strategic assets are defined in both the LGA 2002 and Auckland Council’s Significance and Engagement policy.
The policy defines strategic assets as iconic assets with strategic significance and those assets that are vital for
delivering services to Auckland on a network basis. Included in the list of strategic assets in the Significance and
Engagement policy are “cemeteries, heritage scheduled buildings and structures”.
Categories of historic listed properties are:

Historic heritage category Category definition

Category A have exceptional overall heritage significance to the Auckland region or a greater
geographic area.

Category B have considerable overall heritage significance to the locality or greater geographic
area.

As both of these properties are heritage scheduled buildings, and so may be viewed as strategic assets under
the council’s Significance and Engagement Policy, we are consulting on the proposed sale of these buildings
through this 10-year Budget.

Service assessment
Both properties have gone through a property rationalisation process led by Panuku. This process is used to
determine if there are any service delivery uses for these properties, either now or in the future, that can
realistically be funded by the council. For both properties no fundable service delivery use was identified.

Takapuna
2 The Strand, Takapuna is a category B Heritage building that was donated to the former Borough of Takapuna
by Auckland City Buildings Limited to be used as a library in 1940. As the building was donated for a specific
purpose it is classified as an endowment property.

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7.18 Proposals related to strategic assets

Following the opening of the new Takapuna library in 1989 the property found a new use as staff offices but is
no longer needed for this purpose.
Panuku has managed this property since 2018 and commenced their property rationalisation process that same
year.
Advice given from council staff is that there is no alternate public work requirement or planned and funded future
strategic need to retain the property. Several service uses were investigated, but not approved, including:

• Arts exhibition space (2017)

• Local board office
• Art and historic library collection storage

Legal requirements around sale of 2 The Strand, Takapuna

When the property was donated to the former Mayor Councillors and Burgesses of the Borough of Takapuna,
the transfer instrument did not contain any prohibition of sale or exchange. Accordingly, the property can be sold
under section 140(4)(b) of the LGA 2002 in accordance with section 141 of the LGA 2002. The proceeds of the
sale must be used in a way that is consistent with the purpose of the endowment.

Options considered

1. Dispose of the property – our preferred option

As this property is no longer required for service delivery purposes, disposing of the property is our preferred
option. The sale of this property was approved in principle by the council in July 2020 subject to the completion
of all statutory processes, including 10-year Budget consultation.
Financial implications of the sale include the following:

• Any seismic upgrade would be the responsibility of the purchaser not the council
• Sale proceeds would support the council’s capital investment plans in a way that is consistent with the
endowment.
• The impacts of this option on the council rates and debt is built into our proposed budget.
Other implications include the following:

• Heritage protection will remain as Auckland Council plans that contain heritage schedules all have
provisions in place to protect the properties and ensure that their significance is retained regardless of
who owns the property.
• Property would be able to be used for an alternative purpose
• No change to service levels as this property is no longer required for operational purposes.

2. No Sale
Financial implications of not selling the property include the following:

• The council would need to undertake the necessary seismic work which would need to be funded by
higher rates or debt (or occur instead of other necessary investment)
• The council would try to identify a commercial tenant for the building
• Other surplus assets would need to be identified and sold to achieve the same capital investment
outcomes. If these assets cannot be identified the council would need to either raise debt and rates or
reduce the size of its capital programme.

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7.18 Proposals related to strategic assets

Other implications include the following:

• Heritage protection will remain as Auckland Council plans that contain heritage schedules all have
provisions in place to protect the properties and ensure that their significance is retained regardless of
who owns the property
• No change to service levels as this property is no longer required for operational purposes.

Devonport
3 Victoria Road, Devonport is a category A Heritage building that was acquired by the Devonport Borough
Council from the Crown in 1941 for public offices.
This building was previously used by the council as staff offices, but because it is highly vulnerable to
earthquake damage its occupancy levels have been impacted. It has been vacant since July 2018.
Panuku has managed this property since 2017 and commenced their property rationalisation process that same
year.
Advice given from council staff is that there is no alternate public work requirement or planned and funded future
strategic need to retain the property. During the investigation we looked into four alternatives to selling the
property, but none were pursued:
1. refurbishment of the building and we retain it
2. adaptive reuse of the property where the upper level and rear of the building would be sold for
apartment development and the ground floor would be retained and leased commercially
3. mixed commercial and community use where we retain the ground floor
4. mixed commercial and community use where we sell the rear of the property.

Options considered

1. Dispose of property – our preferred option

As this property is no longer required for service delivery purposes, disposing of the property is our preferred
option. The sale of this property was approved in principle by the council in July 2020 subject to the completion
of all statutory processes, including 10-year Budget consultation.
Financial implications of the sale include the following:

• Any seismic upgrade would be the responsibility of the purchaser not the council
• Sale proceeds would be returned to the council to support meeting asset recycling targets which, in
turn, support the council’s capital investment plans including the provision of new, upgraded, and
renewed community facilities.
• The impacts of this option on the council rates and debt is built into our proposed budget.
Other implications include the following:
• Heritage protection will remain as Auckland Council plans that contain heritage schedules all have
provisions in place to protect the properties and ensure that their significance is retained regardless of
who owns the property.
• Property would be able to be used for an alternative purpose
• No change to service levels as this property is no longer required for operational purposes.

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7.18 Proposals related to strategic assets

2. No sale
Financial implications of not selling the property include the following:

• The council would need to undertake the necessary seismic work which would need to be funded by
higher rates or debt (or occur instead of other necessary investment)
• The council would try to identify a commercial tenant for the building
• Other surplus assets would need to be identified and sold to achieve asset sales targets. If these assets
cannot be identified the council would need to either raise debt and rates or reduce the size of its capital
programme.
Other implications include the following:

• Heritage protection will remain as Auckland Council plans that contain heritage schedules all have
provisions in place to protect the properties and ensure that their significance is retained regardless of
who owns the property

• No change to service levels as this property is no longer required for operational purposes.

Waterfront properties
Overview
Panuku has a programme of work that looks to negotiate and agree commercial long-term leases for
various waterfront properties in the Wynyard Quarter Precinct.
To date, the regeneration of Wynyard Quarter has been extremely successful with commercial,
residential, and marine development delivered by development partners. Private development
complements the delivery of public realm projects by Panuku and combined, they have transformed
Wynyard Quarter into a vibrant and livable community.
Several committed commercial and public projects are nearing completion in Wynyard Quarter.
Consequently, work has started on planning for the next stage of future regeneration.
Work is underway on a refresh of the Waterfront Plan which will look at the next stage of regeneration
in Wynyard Quarter and Wynyard Point.
As part of this planning process, we are proposing to provide in this 10-year Budget for long-term
leases on seven additional council-owned development sites in the city centre waterfront precinct:
North Wharf (site 14), Jellicoe Street (site 19), Silo 6 (site12), Wynyard Point Blocks A and B, 44-56
Hamer Street and 101 Pakenham Street West.

Consultation requirements
Under section 97 of the Local Government Act 2002 (LGA 2002), a decision to transfer ownership or
control of a strategic asset to or from a local authority must not be made unless the local authority has
explicitly provided for the decision in its 10-year Budget and consulted on the proposal through a
consultation document in accordance with section 93E.
Strategic assets are defined in both the LGA 2002 and Auckland Council’s Significance and
Engagement policy. The policy defines strategic assets as iconic assets with strategic significance
and those assets that are vital for delivering services to Auckland on a network basis.

Auckland Council 10-year Budget 2021-2031

Supporting Information 606