The New Zealand Herald reports that the Wellington City Council will be paying more than $200million for a 25 year lease of its new offices on the waterfront.

The report from Ethan Manera was published after the Herald complained to the Ombudsman when the council refused to release the cost, citing commercial sensitivity and saying the lease was a “cost-effective long-term solution” with favourable terms.

In its complaint, the Herald cited the need for transparency for the use of ratepayer funds, and pointing to the publication of details of similar lease arrangements for other city councils’ headquarters.

The Ombudsman investigated the complaint and wrote to the council’s new CEO Matt Prosser. The council then back-tracked on its refusal, and said it would be paying $207million, plus fitout costs, for the two towers formerly occupied by Datacom on Jervois Quay.

The council’s chief Māori officer, Karepa Wall, who is leading the project, said in a statement the council had secured a “favourable rate of $488/square metre in comparison to other CBD lease options, presented to elected members, which had square metre rates between $1000-$1102″.

The council planned to move into its new offices at the start of this year, but in May it said the move had been delayed till December. There’s now been a further delay, with the move not taking place till next year.

The Herald says the council considered moving back into its Civic Administration Building and Municipal Office Building on Civic Square, but decided on leasing the Jervois Quay building in line with officer recommendations. The council then demolished its two office buildings and is negotiating a deal for an Auckland property company to construct a new ten-storey office building on the cleared Civic Square site.

The council announced its 25-year lease of the Jervois Quay building in 2024, when Mayor Whanau said it would be “a cost-effective long-term solution for the Council’s accommodation and for ratepayers.”

Council chief executive Barbara McKerrow said: “We have worked closely … to achieve a great deal for the Council and the city. There are many benefits from the Council being based at this site, including reactivating this part of the city, bringing staff back together to work in a single site, and reducing our overall operating expenses.”

Group Chief Executive Officer of the building’s owner, John Yiappos, said: “We’re delighted to have a blue ribbon tenant like Wellington City Council occupying this iconic building on Wellington’s waterfront. While there are aspects of the lease agreement that are commercially sensitive, I can say that the length of the tenancy was a factor in coming to favourable terms in the agreement.”