Invercargill City Council to contribute $40.5m to city block development

By Rachael Kelly and Jamie Searle

The Invercargill City Council has announced it will contribute a total of $40.5 million towards the new city block development, in recognition of the community wellbeing outcomes the project offers.

Demolition had started in central Invercargill to make way for a new city block development, which will include a food and beverage precinct, apartments, offices, car parks, medical centre, and a possible civic administration building.

On Thursday morning it was announced Invercargill company Amalgamated Builders Ltd (ABL) had been awarded the construction contract for the block.

Councillors approved its funding contribution at an extraordinary meeting on Wednesday, after a series of funding announcements and changes.

Council chief executive Clare Hadley said council’s shareholding in the development project would be approximately 45 per cent as a result of its investment.

“Council considered the increased risks to the development that Covid-19 has created, and has been clear about its desire to support its community, and the local economy.

“Knowing this project offers employment opportunities during both construction and operations is part of that,” she said.

In May 2020, council had consulted with the community on whether to invest extra funding in the development, which would result in a $46m total investment.

The council had also applied to Central Government’s Shovel Ready initiative for funding towards the development.

On June 29, council resolved to approve the $46m investment, and noted the amount would be lower if funds were received from the shovel ready initiative.

On July 1, it was announced that central Government would contribute an additional $10m towards the project.

Hadley said Invercargill Central Limited had since become aware that there had been changes to bank funding availability, because of changes in lending rules as a result of Covid-19.

“Council agreed to cover that shortfall in bank funding. This means that its total contribution to the project is $40.5m – based on the additional $10m from central government coming off the approved $46m investment,” she said.

Three tenders were received for the main construction contract.

Amalgamated Builders Ltd director and general manager Bruce Middleton said his company was looking forward to starting in two or three weeks.

“We love a challenge.”

Middleton thought 175 new jobs would be created with the company securing the contract.

”The majority of people we employ are ratepayers and they’ve got a vested interested in what’s going on here.”

Middleton said the project would be broken into three parts – construction of Farmers, other retail buildings and car parks.

”Separate teams on each one, but [all] working cohesively so that the project’s overall objective is achieved,” he said.

Farmers, a few other retailers and some car parks will be the first to open on the block in February 2022.

Invercargill Central Ltd project manager Geoff Cotton said the announcement of the main construction contractor was a “big step forward”.

ICL is a joint initiative between Invercargill City Council and O’Donnell Family Investment to redevelop Invercargill’s inner-city.