Super site on sale

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Valuable accommodation-zoned land beside Queenstown’s Hilton hotels complex is on the market. 

The four-hectare Kelvin Peninsula site was to have been developed as stages two and three of Kawarau Falls Station. 

After two of Auckland developer Nigel McKenna’s companies crashed four years ago, financier Bank of Scotland International (BOSI) continued to fund stage one. The site’s two Hilton hotels – Hilton Queenstown and Kawarau Hotel – opened in 2011. 

Peninsula Road Ltd – the McKenna company behind stages two and three – was put into liquidation and receivership in 2010, after only some preliminary excavation had been completed. 

The site has remained undeveloped since. 

First mortgagee Fortress Credit Corporation (Australia) II Pty Ltd – owed $43 million plus interest – called in receivers after Peninsula Road defaulted on a loan. 

According to receivers’ reports, Allied Farmers Investments Ltd is owed another $83m and BOSI an “unknown” amount, while unsecured creditors are also owed several million dollars. 

A resource consent for stages two and three, which expires in 2016, allows for eight buildings including 223- and 195-room five-star hotels, a 109-room four-star hotel and luxury visitor and residential apartments. 

All up there’s consent for 780 hotel rooms and apartments. 

International chains Quay West and InterContinental had been tipped to operate two of the hotels. 

The InterContinental was to include a 1000-capacity conference centre that was expected to underpin the whole Kawarau Falls Station complex. 

Peninsula Road receiver Grant Thornton New Zealand has appointed real estate agency Jones Lang LaSalle to market the stage two/three site. 

The site, comprising three titles, is bordered by Lake Wakatipu, a 120m stretch of Peninsula Road and a 67m stretch of the Kingston highway south of the Kawarau Falls bridge. 

The property’s combined value, as at July 2011, was $15,925,000. 

Jones Lang LaSalle, in a press release, states the property is the only large, high density-zoned and consented north-facing waterfront site in Queenstown. 

It also receives all-day sun and protection from prevailing winds. 

Jones Lang LaSalle managing director Nick Hargreaves of Auckland says: “Queenstown is a world-class destination and is now one of the most positive property markets in NZ with strong market dynamics. 

“Owing to good tourist numbers, increasing population and a tightly-held CBD where property values have recovered strongly, Kawarau Falls Station is a rare opportunity. 

“The fact the site is zoned recognises there is a need to provide for high-density accommodation to ensure suitable housing for residents and accommodation for visitors close to Queenstown and Frankton.” 

Jones Lang LaSalle is marketing the property across Asia-Pacific. 

The deadline for expressions of interest is March 1.