Around $38.6 million is expected as gross proceeds from the sale of seven or nine Tauranga Council elder housing villages to Kāinga Ora: Homes and Communities earlier this year,

The expected sale revenue is made up of $17.2 million from the seven villages sold to Kāinga Ora, the sake of 58 and 60 Pooles Road to Kāinga Ora, at market value, and the future sale of the Pitau Road village and Hinau Street villages, at market value.

It was recently announced that the Sanderson Group has signed a conditional agreement to purchase the Pitau Road village to develop the site as a retirement village, says a statement from Tauranga City Council.

Hinau Street village has not yet been sold. With the sale process now well advanced, council is looking at future options for the reinvestment of the sale proceeds.

Commission chair Anne Tolley says when council decided to sell the elder housing portfolio, the intention was to 'reinvest the proceeds into delivering housing outcomes for the city, which remains our intention”.

'Addressing housing needs remains a key priority for the city and some of the sale proceeds have already been used for this purpose.”

The total committed and actual expenditure from the sale proceeds to date is $7,882,731 which consists of:

-$3 million in development contribution grants approved for community and papakāinga housing.

-$3.21 million to relocate the Tauranga Women's Collective from the Pooles Road properties adjacent to Pooles Road village, allowing these sites to be combined to provide higher density redevelopment opportunities.

-$1.672 million of costs associated with the disposal of the property portfolio.

'It's heartening to see the progress made towards realising a fund which can be used to support better housing outcomes and we will now do a bit more work before consulting the community on options for the remaining funds,” says Anne.

On July 25, 2022, council adopted principles to guide future reinvestment of sale proceeds.

Funds will remain in non-profit entity control and will be used to:

-Deliver an increase in public, social, affordable and elder housing for Tauranga.

-Minimise private individual profit (i.e. provide housing that benefits many over time, rather than delivering capital gain for a select few).

-Support opportunities to bring in additional external funds.

-Retain long-term community benefits.

On July 25, 2022, council also authorised staff to:

-Work collaboratively with BayTrust on a co-design model for a proposed Housing Equity Fund, based on a possible Tauranga City Council investment of at least $20 million.

-Complete further work investigating the establishment processes, costs, governance, and potential return on investment of setting up an independent entity, versus investing alongside others (such as investment into the proposed Housing Equity Fund).

A decision on the quantum of funds to be invested, and the nature of the investment involved, will be consulted on via the 2023-2024 Annual Plan process.