4 June 2019
The Overseas Investment Office (OIO) has granted the first residential-related standing consent under new rules introduced in October 2018 to make it easier for large developers to buy land to build houses
Fletcher Residential Ltd was approved in April to buy up to 200 hectares of residential (but not otherwise sensitive) freehold land in Auckland, Canterbury or Waikato. It can make up to 12 transactions by 1 May 2022 (the length of the term of the standing consent).
The Overseas Investment Act defines Fletcher Residential as overseas owned. It is owned by listed Fletcher Building, which has operated in New Zealand since 1909.
Large developers can apply for standing consents before identifying the property or land they want to buy. The standing consent acts as a form of ‘pre-approval’, whereby the investor must notify the OIO each time they settle a transaction in relation to the standing consent.
This type of standing consent was introduced as part of the Overseas Investment Amendment Act 2018 and is designed to encourage housing development. Only quality investors with a proven track record, detailed business plans, and processes in place to ensure that they comply with conditions of the standing consent will be granted a standing consent.
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