Whanganui council to buy CBD properties for hotel plans – Medical Marijuana Program Connection

Whanganui District Council has agreed to buy the properties near the corner of Ridgway Street and Victoria Avenue.
Photo: 123RF

The Whanganui District Council is pushing ahead with a buy-up of three properties in the CBD facilitating the development of a four-star hotel and carpark in the city.

The move comes ahead of public hearings and deliberations on the draft long-term plan which asked for public feedback on a proposed council-led 60-bed hotel project

Council agreed to buy the properties – worth about $4 million – near the corner of Ridgway Street and Victoria Avenue – using $3.5m from the Whanganui Endowment Fund with the remainder debt funded.

The fund’s property portfolio already includes about 40 properties with a value of about $45m.

Chief executive David Langford told councillors that buying the three properties would support a feasibility assessment for the hotel and carpark proposal, but that the investment stacked up whether a hotel development went ahead or not.

He reminded councillors they had agreed to a plan to grow non-rates revenue to ease the burden on ratepayers.

“The annual return on capital of this purchase will be about 5 percent or a net of $190,000 a year with room to improve this with a bit of management.

“The return on the properties is good enough that it is a sensible addition to the city endowment portfolio whether the hotel occurs or not. I acknowledge the timing is not great and there will be perceptions that council is…