Auckland council has agreed to look at selling prime downtown space to private property developers.
Precinct Properties wants to develop a 1 hectare chunk of land stretching from the Wynyard Quarter to Queen Elizabeth Square, including a major revamp of the Downtown shopping centre.
The council today said in a statement that it had "agreed in principle to negotiate the sale of Queen Elizabeth Square to Precinct Properties New Zealand Ltd in return for proceeds being used to provide quality downtown public spaces".
Precinct chief executive Scott Pritchard said it was widely accepted that Auckland's CBD was shifting from one that ran north-south down Queen St to one that followed the waterfront.
The Wynyard development would take five to six years at a cost of about $200 million, and there was a hope that it would foster an existing "innovation hub" of technology-oriented companies already on site.
A plan by Precinct Properties for the comprehensive redevelopment of its property holdings in the area has also opened an opportunity to reintroduce aspects of historic Little Queen Street which was lost in earlier redevelopments.
"We are in the very early stages of proposals for this area," said Deputy Mayor and Auckland Development Committee chair Councillor Penny Hulse.
"With the city rail link tunnels running below Precinct Properties buildings, it makes sense to align the tunnel construction with the company's development programme.
The Precinct proposal come just a week after another bid to privatise and develop another prime waterfront area in Auckland.
Australian investors have offered to spend up to $50 million developing Auckland's Queens Wharf.
The offer to build two commercial buildings on the wharf, in exchange for upgrading the adjacent ferry terminal, comes from a Cayman Islands-registered company fronted by New Zealand businessman Sir Noel Robinson.
Robinson, a prominent supporter of Auckland Mayor Len Brown, said the proposal came from a group of wealthy Australians, and he had no financial investment in the company.
Robinson said the group was proposing to lease the land on Queens Wharf from the Auckland Council rather than buying it.