Invercargill’s new $2.8 million council-owned housing complex for elderly residents has drawn criticism from some city councillors over its high construction costs. The Miller Street development, which opened in May, consists of six single-bedroom units equipped with mobility-friendly bathrooms and garden beds.

Councillor Lisa Tou-McNaughton voiced concerns during a recent council meeting about the building expenses, pointing out that the project cost approximately $9,200 per square metre—roughly double the rate of constructing similarly high-specification units in retirement villages. She described the price as “excessive.” Councillor Andrea de Vries also labelled the expenditure “exorbitant” and questioned whether the council was effectively utilising its own expertise in areas such as landscaping to manage costs.

Council manager Patricia Christie responded by emphasizing that all components of the Miller Street project underwent a formal procurement process. Christie noted that design factors significantly influenced the overall cost and said that future developments would be reviewed with a more stringent financial focus.

Additional concerns were raised by councillor Alex Crackett, who highlighted the financial burden on ratepayers. She pointed out that, while rental income covers operational costs, it does not offset depreciation, interest, or debt, leading to a worsening financial position across the council’s elderly housing portfolio.

At the time the Miller Street units opened, more than 50 people remained on the city’s elderly housing waiting list, underscoring ongoing demand. Various organisations, including Presbyterian Support, have provided the council with data showing that Invercargill’s housing stock predominantly consists of three-bedroom homes, whereas 55% of households are made up of only one or two persons. Furthermore, building consents for retirement village units and apartments have represented only a small fraction since 1990.

The council manages 21 housing complexes across Invercargill and Bluff, offering a total of 222 units. The Miller Street development replaced four units dating back to the 1950s on the same site. Last week, the council agreed to explore partnerships with other organisations to expand elderly housing options and is currently considering three potential new sites for future development.