Steve Evans, chief executive of Fletcher Housing. Photo / Michael Craig
New Zealand’s largest registered construction business has won state approval to buy country land on the north-western suburb of Auckland for sprawling new housing.
The Foreign Investment Office said last week approval had been given to Fletcher Building’s subsidiary, Fletcher Residential, to buy 20ha from a vendor whose name was withheld and for an amount that was also suppressed.
The agreement came the same month the business sold a controversial site in Mangere for $ 30 million following a deal with the Government to buy disputed Ihumātao land.
Riverhead is now a new focus for a subsidiary led by Steve Evans.
“Fletcher Residential is developing residential land and building new residences. The land acquired is about 20ha of rural land in Riverhead northwest of Auckland,” OIO said last week.
They intend to zoning cropland for urban use in response to Auckland’s fast-growing population and location features, the office said.
“Housing construction will likely be between five and eight years ahead of investment due to previous re-zoning. This is likely to advance the Government’s goal of providing more housing, faster,” the office said.
As one of the largest home builders in the country, the company has made many investments that have benefited New Zealand, he said. The NZX listing on the Fletcher Building also allows New Zealanders to participate in the business, he said.
These are the factors that support licensing.
Damien O’Connor, Minister of Land Information, and Minister of Finance of the Association gave approval. David Parker and Megan Woods are association finance ministers.
Approval is needed because the land is classified as sensitive, it is a large rural land. Approval is also required because Fletcher is classified as an overseas entity: 49 percent Australian owned. Despite being listed here, only 19.9 percent of the shareholders are kiwis. America holds 15 percent and Britain 7 percent.
Fletcher can buy 7ha of land on Riverhead Rd, 1ha again on another block on the same road, about 8ha on Lathrope Rd and another 4ha on the same road.
Lathrope Rd meets Riverhead Rd near the Old North Rd junction.
The only information available about these vendors is that they are 100 percent New Zealand owned.
Gregory Allan of Simpson Grierson acts for Fletcher.
Approaching the comments, Fletcher declined: “It’s a little too early in the development stage for this level of detail, but when we’re ready to announce we’ll be happy to talk to you.”
Fletcher Residential has aroused the ire of the locals in the aftermath buy A 109ha dairy farm near Kumeu where they can build thousands of houses next to Taupaki township by 2045.
In December, The Herald reported on local lawmaker Chris Penk as saying repeated haphazard construction had left northwest Auckland in traffic jams and a shortage of classrooms.
The Auckland Council also expressed concern, saying that Fletcher’s new land lies outside an area earmarked for future urban growth.
That risks disrupting the city’s growth plans and piling up more costs on price payers, he said.
Fletcher Residential lists the locations where it plans to build, build and / or sell homes that are all in Auckland: Beachlands, Glen Innes, Hobsonville Point, Karaka, Ormiston Panmure, Red Beach, Stonefields, Swanson, Te Atatū Peninsula, Waiata Shores and Whenuapai.
In the year to June 30, 2020, Fletcher Residential generated $ 466 million in revenue from residential development, down from $ 639 million the previous year. The business noted the effects of Covid and a lockdown from late March that halted all work except essential construction.
“From March to early May, home sales were negatively impacted by the close of Covid-19 level 4. The absence of sales during these important selling months, as well as delays in house completion, resulted in 666 units being profited in FY20 compared to 755 units a year earlier .
“Home sales activity in May and June was very strong, although most of these sales will be completed in the new financial year. Demand for homes in Auckland in the $ 600,000 to $ 900,000 price range remains strong, reflecting interest from first-time buyers and investors,” the company said. in its annual report.
Trading cash flow for this division was $ 118 million compared to $ 95 million a year earlier. The cash flows included a $ 50 million receipt for the sale of Wiri’s land development, according to Fletcher Residential’s annual summary.