Hastings District Council and Foodstuffs North Island have agreed to cancel the sale and purchase agreement for land in Flaxmere, the Council announced today.
Council said the “difficult decision” followed Foodstuffs North Island’s conclusion that building a supermarket on the site in the current economic environment was no longer sustainable.
Foodstuffs spokesperson Emma Wooster said, “Building a new supermarket can be a lengthy and unpredictable process, and since planning for the project started in 2021, a lot’s changed with the market conditions, making it much more expensive when it comes to building and fitting out a new store.”
“We’re both really disappointed to not be able to go ahead with the project and we know this will also be disappointing for the community. We’ve looked at it from every angle, but the market realities mean it’s just not feasible to go ahead with the build right now and deliver value.”
She said that while the project wasn’t moving forward, Foodstuffs North Island was “absolutely committed to serving and investing in Hawke’s Bay communities”.
The Council’s 2021 agreement to sell the land to Foodstuffs followed 10 years of engagement with the community and testing the market with potential supermarket operators.
Hastings Mayor, Sandra Hazlehurst said she was very disappointed that the new supermarket was not able to proceed, but accepted that the challenges posed by the rapidly increasing construction costs over the past three years had made such endeavours difficult for such large projects.
“Our council is committed to creating a fit-for-purpose town centre for Flaxmere. We have commercially-zoned land that gives us options to advance this,” she said.