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Redevelopment plans for old supermarket site at Kensington

28 Sep 2018

Indicative project image only

Indicative project image only

A deal that could pave the way for the redevelopment of the former supermarket site at 8 Kensington Avenue is being progressed by the Northland Regional Council.

Discussions with proposed development partner, Argyle Estates Ltd, would transform the vacant council-owned site into a bustling suburban centre, likely to include medical and convenience retail and a new build.

“This corner property has been empty for four years and a redevelopment will inject new life into the high-profile site,” says council Chairman Bill Shepherd. “We’ve looked at various options over the years and now we have something on the table that we believe can restore vitality to this area.

“People have let us know they would value commercial and retail activity at this location and we feel sure they will welcome a fresh, new look that offers change and brings new energy to the community.”

Preliminary work includes due diligence, preparation and lodging of all required consents, tendering for the construction works, and securing commitment from anchor retail and medical tenancies. The construction contract will be open for tender, giving local companies the opportunity to participate.

This preparatory phase has been given the full council’s go-ahead and will be funded through the Property Reinvestment Fund. The council has signed a Heads of Agreement to enter into a development agreement contract with Argyle.

Once preliminary work is complete, the documentation will be brought back to the council for “go or no-go” consideration. A decision to proceed would allow the selection of a construction contractor for the redevelopment.

A real estate agent selection tender process in 2016, resulting in a sale and purchase agreement with Argyle’s related company Aheto Holdings Ltd, has now been cancelled to allow council to retain ownership of the property.

“The property will be retained in full council ownership as a tenanted investment property,” says Chairman Shepherd. “It will become an important part of our property portfolio which significantly subsidises rates and council activities.”


The Kensington Avenue location has been a significant focal point, beginning in 2014 with delays largely due to Public Works Act acquisition issues that held up Whangarei District Council improvements to the Kensington Avenue/Kamo Road intersection. Now completed, these improvements have since increased the profile, access to and value of the site.

An independent valuation report puts the final value of the project between $13m and $16.5 million, depending on the final tenancy mix.