Warkworth land sale to overseas buyers blocked by OIO

A group of Chinese developers could be forced to sell this block of land near Warkworth.

A group of Chinese developers has been blocked from developing a 80ha site near Warkworth and could face charges after failing to apply for Overseas Investment Office (OIO) approval to buy the land.

The land, at 185 Sandspit Road, was sold to Hong Zhongliang, Ke Xueli, Gu Xinrong and IRL Investment Limited in 2012 for $4,480,000.

None of the buyers live or intend to live in New Zealand, so they were required to apply to the OIO for approval. However they only recently submitted a retrospective application which was declined in September.
An OIO spokesperson said the group planned to subdivide the farm into 24 lots, and rehabilitate a 30ha area of wetlands.

One of the lots would be turned into a “country estate” to create a “luxury farm-like community, showcasing New Zealand’s pure lifestyle and the benefits of a rural lifestyle”.

The application said this would create jobs, result in investment in the area, protect and enhance the environment and improve walking access. It said rejecting the application could send a negative message to other overseas investors.

The OIO said the application had insufficient evidence to show the benefits would be realised and the benefits weren’t substantial enough to meet the criteria of the Overseas Investment Act.

“The only factor which was met was ‘walking access’,” the spokesperson said. “This was given a low weighting in assessing the likely benefit to New Zealand, as the applicants had only committed to consultation with the Walking Access Commission, rather than committing to specific mechanisms to improve walking access.”

The land includes the area between the Rodney Cooperative Lime Company quarry on Sandspit Road and the Warkworth Golf Club on Golf Road. Auckland Council records identify it as a dairy farm and it is zoned Countryside Living in the Unitary Plan.

Acquiring sensitive assets without OIO approval is an offence with a maximum penalty of a $300,000 fine and/or 12 months in prison and the owner could be ordered to sell the land.

The OIO was still considering what further action it would take.

“We will make a decision about our next steps as soon as possible.

“The OIO doesn’t comment on active or potential investigations, including the nature and timing of key decisions concerning investigations.”