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BusinessSeptember 14, 2023

Ian Cassels is extremely bullish on Wellington. Why is he threatening to leave?

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Property developer Ian Cassels is Wellington’s biggest believer and Auckland’s biggest hater. Yet he recently threatened to stop investing in the capital. Joel MacManus sat down with him to learn more. 

I was up late one night, watching replays of Wellington City Council meetings because I’m a very cool person with an exciting life. It was the final meeting of public submissions on the Golden Mile upgrade to give Lambton Quay and Courtenay Place a much-needed spruce-up. It’s broadly popular among the public, but has faced furious backlash due to the plans to reduce parking spaces and limit car traffic at certain times of day.

The people trotting up to the table to have their say were pretty much who you’d expect: a handful of cycling advocates and progressive urbanists supporting the plan, and a larger group of suburban boomers swearing they would never visit the city again without more car parks.

The councillors looked bored. They had heard all these arguments a million times before. But the law says everyone gets a say, so they were letting everyone have a say.

Then Ian Cassels walked in. Everyone at the table sat up.

That’s the kind of effect Cassels has in Wellington. There’s probably no one else alive who has had more impact on the city’s built environment than him – and no one with more potential to influence its future.

The Wellington Company, led by Cassels and his partner Caitlin Taylor, built Hannah’s Laneway, Spark Central, Conservation House, the ARO townhouses, the Mews in Island Bay and much more. It’s almost easier to list the buildings in Wellington the company hasn’t worked on.  

All the buildings The Wellington Company has developed or converted in the Wellington CBD. (Image: supplied)

For the past nine years Cassels has been best known for his connection to the Shelly Bay development, a 350 home project on the Miramar peninsula that he dubbed “the Sausalito of the South”.

The Shelly Bay controversy itself was messy situation that crossed political lines and turned Ian Cassels into the city’s most polarising figure.

The development was a partnership between The Wellington Company and the Port Nicholson Block Settlement Trust, the commercial arm of Taranaki Whānui. It was supported by Yimbys who liked that it provided more homes; environmentalists who liked that it was a mostly car-free development supported by an electric ferry; and some rich people who were interested in buying the flash new houses.

It was opposed by Mau Whenua, a sub-group of Taranaki Whānui who argued the iwi’s commercial arm should not have sold the land; environmentalists who wanted to turn the area into a nature reserve; Nimbys who wanted to stop new people from busying up their quiet suburb; a cycling group who didn’t like the road design; and one extremely wealthy man: Sir Peter Jackson, famed director of The Frighteners

Cassels sold the land earlier this month to Jackson, admitting he had grown tired of the project. 

When he sat down at the council table in June, Cassels revealed a huge new vision he dubbed “Let’s Get Wellington Walking”. He described an incredibly bullish future for Wellington: 100,000 new residents living in centre city apartments; a low-carbon, walkable and vibrant city teeming with growth. He suggested the council should scrap the Golden Mile changes and take the entire Let’s Get Wellington Moving programme back to the drawing board so the council could re-plan things around his ideas.

Frankly, it was an impossible ask. Cassels wields a lot of influence, but it was way too late in the piece to drop the entire Golden Mile project. Final submissions are the place for minor design tweaks, not to overhaul the entire thing.

The left wing majority on council were excited by his vision of a green, urbanised city, but frustrated that he was coming in at the last minute and trying take a sledgehammer to the programme they’ve spent years working on, rather than being part of the change. The right wing liked that he opposes light rail, but his ultra-green, ultra-urban ideas aren’t a natural fit there either. Many councillors on the right were also vehement opponents of Shelly Bay.

It was an example of the strange position Cassels holds within Wellington’s political landscape. He’s immensely influential, but has no natural allies. After the meeting, he went on Newstalk ZB and publicly threatened to stop investing in Wellington if changes weren’t made to Let’s Get Wellington Moving – a hardball strategy that will only deepen the divide between him and the council.

If he does stop investing in the capital, it would be a genuinely huge loss. Wellington needs major developers like him in order to address the housing shortage.

We caught up at Mosscafe inside Todd Tower (another one of his buildings) to talk about the future of Wellington.

Cassels has grown jaded. He’s pissed off at the council taking too long to process consents and making life difficult for big builders like him. Shelly Bay was a nightmare project, he says – he felt like he was doing something good by building more homes but got no support from council. It’s an intriguing contrast: he’s incredibly optimistic about the city’s potential, while also increasingly pessimistic about the prospect of good things coming to pass.

Ian Cassels has a prediction: within 30 years Wellington will have 500,000 people in the city and a million in the wider region. He says it with a shrug, so confident and casual that it takes a second to realise how bonkers it is. He’s talking about the city more than doubling in size – a growth rate four times higher than the council’s upper-end projections.

An extra 100,000 people in the centre city is easy, he reckons. Maybe even 150,000 – and at least that again in the suburbs. “If you say that now, people will say you’re nutty. But it’s not many people for a city this size,” he says.

He’s spent years trying to convince people to try inner-city living, ever since he completed his first development, Invincible House, a former insurance office converted into a handful of apartments. The concept is catching on – the number of apartments and townhouses being built is at an all-time high and growing – but it is still fundamentally a new and unfamiliar way of life in a country that historically aspired to a quarter-acre section in a quiet suburb.

“The pattern of living in New Zealand is all wrong for our century,” Cassels says. “New Zealand is still in the 1960s, it hasn’t adjusted. It was alright when we had cheap petrol and we espoused mediocrity, but the city is the only hope. That’s clear. You can have more interests, bump into more people, and have a more interesting life.”

The ARO Townhouses in Wellington’s CBD, built by Cassels’ company (Image: supplied)

He has spent a lot of time thinking about his theory of cities. The secret sauce is density: more people can live within walking distance of their workplaces, connect more easily with friends, and cut their carbon footprint by living comfortably car-free. “The future can only be about intense and efficient living for most people. The wealthy can have whatever they like and they always can and they always should, because that’s the incentive for getting wealthy, I guess. But more of society will need to accept that life is going to be more streamlined but hopefully more fun and with less cost. If you get those things in the right order, they’ll thank you for it in the end.”

He points to Willis St, the narrow 330m stretch between Manners St and Lambton Quay, as an example of how great city streets can be. With the newly opened Willis Lane precinct, residents have access to cafes, bars, food courts, a pharmacy, optometrists, a New World Metro, gyms and a creche all on one street. “You’d never have to leave it. I’m not saying that’s a healthy thing, but you’d have everything you need. It’s not a bad model to know you can get everything. It’s the way overseas cities work.”

Wellington is full of smart, liberal policy analysts and transport planners who will talk your ear off about the future of cities and their big ideas for how to make them greener and livelier and better in every way. In a way, Ian Cassels is just like them. He’s a man with hot takes about cities who likes sharing them. The difference is he has the resources to do something about it. He throws around the kind of money that can truly shape a city. When he talks, politicians and other big investors listen. 

But he doesn’t fall neatly into the urbanist political philosophy. He likes walking, but he’s not as hot on bike lanes. He wants a market solution that makes parking harder and more expensive, but doesn’t want to get rid of car parks. He doesn’t think Wellington is big enough to justify light rail – “In 20 years’ time, light rail will become feasible” – and says its construction will cause “10 years of misery”.

“It’s an article of faith that if you’re green, or you believe in the planet, that you must support light rail,” he complains. He’s against light rail primarily because it would encourage new housing to be built along the transport spine out to Island Bay, rather than in the middle of the city where he prefers to operate. 

An artist’s rendering of light rail to Wellington Regional Hospital. Source: LGWM

The council gets the brunt of his ire. He wants an overhaul of the consenting process to fast-track big developments like his, and he wants council chief executives to prioritise growing the population above all other goals.

Is he serious about leaving Wellington? He says he is, and again blames the council: “If you piss on [the city] for long enough, you’ll destroy it. It’s like spraying it with Roundup.”

Cassels began his career a sandblaster and spray-painter with his brother Alasdair (who later founded Cassels Brewing Company), before making his first foray into property development in the early ’90s. The 1987 property boom had seen an explosion of new office buildings going up in Wellington, driven by cheap money. “Wellington overbuilt in ‘87. There were lots of shit buildings,” he says. We could have bought the whole lot if we had 20 bucks, because the city was on its knees.” 

His bread and butter became taking rundown commercial buildings and sprucing them up into new homes and offices. 

In the three decades since, Cassels has kept his investment focus firmly on the capital. The Wellington Company has had a couple of projects in Christchurch, and two current builds in Ōtaki and the Kapiti Coast, but has never invested in Auckland. “I’m fundamentally opposed to Auckland,” he says. “It’s just wrong. It doesn’t make sense, it’s not a good thing to invest in.”

And he has his rather blunt reasons. “I call Auckland a city that’s never been built,” he says. “You wouldn’t run that city in any other country and think you’re clever. It’s spread out, disastrous. They go on about how wonderful Wynyard Quarter is, but it’s just a little bit of land down at the bottom and the rest of it is shit.”

As an investment thesis it’s controversial – Auckland has grown faster than Wellington over the past few decades, and a lot more money has been made in the Auckland real estate market. But he thinks that was an aberration: “It’s a boom and bust driven by greed and Maseratis and bad habits.”

The main reason Auckland has driven so much growth, he posits, is that all investment relies on predictable population growth – “Auckland always promised that, but I don’t think it’s true anymore.” Where is the next great growth opportunity? “Wellington will grow faster – it must.”

‘The biggest possibility for vertical takeoff is Wellington,’ Cassels says. (Getty Images)

It’s just a brighter place, he says. “The thoughts are here, the ideas are here. The thought leaders of the country are here. Everything points to this being the place that you invest time, effort and money into.

“I’m not against Auckland, I’m just saying relative to Wellington it doesn’t do much. It grabs all the attention, all the money, and pretends it’s the biggest issue in the country. But the biggest possibility for vertical takeoff is Wellington.” There’s billions of dollars in value in Wellington, just sitting there, waiting for the right developer with enough money to unlock it, Cassels reckons. The reason is a massive infrastructure surplus flying way below everyone’s radar: the pipes. 

Wait, really? Wellington’s pipes – the ones that are always bursting and cracking and have been underfunded for decades on end? Yes, those pipes. As he’ll explain to anyone who’ll listen, the pipes in the Wellington city centre are really big because there’s a huge daytime population of office workers. “We only have 20,000 people living in the city, but it swells to 108,000 people a day. What are the pipes doing at nighttime? Nothing. They’re having time off.”

This means there is free, excess infrastructure already sitting ready in the city for anyone who wants to build a new apartment building or convert an old office. It’s potentially a lot cheaper than building a greenfield development, which requires all new roads and pipes. “I see it through a property developer’s eye. I see value in the current city that is enormous.” The biggest obstacle, he says, is a lack of capital and willing investors. “If Bill Gates owned the city he could make a fortune.”

The major thing holding Wellington back in recent years has been earthquakes. The 7.8 magnitude 2016 Kaikōura quake fatally damaged a number of waterfront office buildings and forced several city institutions to close for repairs, including the central library, town hall and Reading cinema. It also created a cottage industry of newspaper op-eds about how the city is dying. Should earthquake risk scare investors? Cassels doesn’t think so. “Our buildings aren’t weak, they’re incredibly strong. The only ones that came down were the crappy ones on the waterfront that shouldn’t have been built on porridge… our buildings are bloody good and they got through a 7.8m earthquake.”

But, he bemoans, “our PR is hopeless. It gets treated like ‘earthquakes are going to happen, so why bother?’ Tokyo’s not like that, no other city with problems is like that, proper cities accept that they’re here forever. It’s about time our council decided that.”

He goes on: “The best place to have an earthquake is the place that has earthquakes….It’s the places that don’t have earthquakes that really suffer when they do. When Auckland has an earthquake, it’s fucked.”

Cassels has such a deep affection for Wellington (and obvious disgust for Auckland) that it’s hard to ever see him leaving. Let’s Get Wellington Moving will almost certainly be cancelled under a National government (which is a solid bet given current polling). The Golden Mile upgrade will still go ahead, but light rail will be off the cards. In that sense, Cassels will get his wish.

I ask him him one more time if he would ever really walk away from Wellington. “I’d be the last to give up. I never give up. But even the person who says never give up must give up.” Then his voice softens a little. “But how could you turn your back on this city? It’s got so much going for it.”

Keep going!