Housing Minister Megan Woods has rejected special fast-tracking treatment for the planned new 5000-home Sunfield south Auckland development.

She told NZX-listed Winton Land yesterday that its application for Government housing agency Kāinga Ora to assess the project under the Urban Development Act had been declined.

She wrote to chief executive Chris Meehan saying Ministers of Finance and Housing would not direct Kāinga Ora to undertake a project assessment of the Papakura scheme as a special development project.

The need to avoid adding further pressure to already constrained Government resources and Treaty of Waitangi interests were cited in the rejection.

"We consider that on balance, the benefits a direction to assess could provide would be outweighed by the impact on other Government priorities," she said.

The decision was influenced by two aspects: the need to ensure the decision was exercised consistently with the purposed of the Urban Development Act and Treaty of Waitangi principles, Woods told Meehan.

Plans for Sunfield are for 5000 new homes. Photo / Winton Land

The act aims to tackle long-term barriers to urban development by allowing access to a streamlined approval process for special types of complex and transformative development projects.

"The advice we received from officials is that there is a pipeline of projected development through spatial and strategic partnerships that are being considered by Kāinga Ora for potential selection and assessment under SDPs, some of which could be selected soon," Woods told Meehan.

Meehan today expressed his disappointment about Woods' decision.

Sunfield "should have been a slam-dunk project for an astute, future-focused Government", he said.

"The decision robs south Auckland of a significant economic development opportunity that would have sustained a significant number of high paying jobs and created fantastic training and development opportunities for apprentices. Many local community and iwi groups backed our vision for Sunfield, so they too will be disappointed in this decision.

Megan Woods said Sunfield would not be considered under the act. Photo / Mark Mitchell

"A car-less, solar-powered, 15-minute neighbourhood also aligns with what local government authorities are pushing to achieve, which is to minimise adding more cars on to Auckland's heavily congested roads.

"This Government seems to believe that Kāinga Ora are the only ones who should be delivering new houses. That is why the housing crisis keeps getting worse under their watch."

Winton can develop already-consented plans for a 50ha portion of the area for around 1500 homes.

It will then assess its options under the Resource Management Act to gain consents for the balance of the balance, which is 150ha of the 200ha Sunfield site, Meehan said.

It was now nearly 200 days since Winton applied for Sunfield to be considered under the Urban Development Act.

Meehan has complained that Sunfield won't be considered under fast-tracking legislation. Photo / Winton Land

Chris Bishop, National's housing spokesperson, called on the Government "to properly explain" why it has turned down Sunfield's fast-tracking.

Woods' letter was bizarre. Basically, Kāinga Ora is too busy to properly engage in the process. What are the extra 1700 Kainga Ora staff hired under this Government doing?
Having passed the Urban Development Act to facilitate large developments, the Government is now turning down proposals that seek to take advantage of the very law it passed. Our housing challenges won't be solved if ministers will not properly consider developments like Sunfield," Bishop said today.

Instead of buying existing homes and outbidding first home buyers, the Government should be able to justify its decisions, Bishop said.

In November, the Herald reported how Meehan was taken aback when the Government housing agency Kāinga Ora turned it down for a fast-track consenting process.

Meehan said then he was disappointed at the decision by Kāinga Ora.

But Kāinga Ora general manager urban planning and design Katja Lietz said that after carefully considering the proposal, the housing agency did not consider it would be able to add value to the proposed development using the power of the Urban Development Act.

"A partnership with Kāinga Ora as anticipated by the act may add unnecessary complexity and uncertainty to this project."

Lietz said Kāinga Ora had specific concerns about aspects of the development that could only be resolved in consultation with other parties.

"For example, proposed infrastructure to address the risk of flooding would only be feasible in a willing partnership with Auckland Council. We proposed discussions with Council to explore this and the proposer declined," she said in November.

Lietz said last year that progressing a proposal under the act deviates from the Resource Management Act process and becomes a partnership between the developer and Kāinga Ora.

Winton Land, which only listed on December 17, has a market capitalisation of $978m and been trading around $3.30. Its forecasts for the full year are unaffected by the minister's decision, the company said today.