1,500 new homes at Te Awa Lakes

Through the Infrastructure Funding and Financing Act 2020, the Ministry is supporting housing supply in the Waikato region, with approval of a levy for the Te Awa Lakes Project in Hamilton.

An Infrastructure Funding and Financing levy is a mechanism under the Infrastructure Funding and Financing Act 2020 that allows infrastructure that supports urban development to be funded upfront and repaid over time by the owners of the properties that benefit.

The finance is raised by a special purpose vehicle (SPV) on the strength of the levy, and the levy is collected annually alongside council rates rather than requiring large upfront payments. Levy revenue is ringfenced to repay eligible costs, such as the costs of construction.

In this case, the levy, administered through Hamilton City Council, will help provide the essential water and transport infrastructure needed to deliver around 1,500 new properties northwest of Hamilton.

The levy will be disclosed before anyone buys a property, so it can factor it into their purchasing decisions, including mortgage and affordability assessments. 

The levy mechanism will provide up to $50 million to fund eligible water and roading infrastructure. The finance will then be repaid over a 30year levy period starting 1 July 2027.

The levy was proposed by the developer, Te Awa Lakes Joint Venture, and is the third project to use the IFF levy, others include:

• Tauranga’s Transport System Plan, a citywide levy enabling about $175 million to be raised towards 13 transport projects.
• Wellington’s sludge minimisation facility, which raised $400 million for construction the facility. Levies were applied across most of Wellington City’s rating area.