Government support of up to $22.4 million will help accelerate development of Te Utanganui – The Central New Zealand Distribution Hub in Manawatū, improving road, rail, air and port networks.

The government loan to the Central Economic Development Agency (CEDA), approved through the Regional Infrastructure Fund (RIF), will support the next phase of planning and development for rail between Palmerston North Airport and Bunnythorpe, helping unlock one of New Zealand's most significant freight and logistics opportunities.

The funding will be delivered in stages, with $1.9 million allocated to CEDA for pre construction work, followed by $20.5 million for construction once a robust Business Case and delivery plan have been confirmed. 

The Business Case will inform what rail infrastructure needs to be built for the first stage of KiwiRail’s Regional Freight Hub, within the wider Te Utanganui precinct.

Led by CEDA, in partnership with local councils, Iwi, KiwiRail and private sector partners, Te Utanganui is a nationally significant programme of infrastructure and industrial development that brings together road, rail, air and port connections to create Central New Zealand's leading distribution hub.

CEDA Chief Executive Jerry Shearman says the funding is a major milestone for both the region and New Zealand's wider transport and logistics sector.

"This investment provides the confidence needed to move forward with detailed planning and business case development for the first stage of the Regional Freight Hub.

“Rail is a critical component of Te Utanganui and will help cement Manawatū as a strategic freight and distribution gateway for the country." 

Shearman says the project is already generating strong interest from industry and investors. 

"Alongside ongoing development at Palmerston North Airport, future industrial land opportunities in both Palmerston North city and Feilding, and work progressing on the business case for the Manawatū Regional Freight Ring Road, we're building the foundations for a nationally significant freight ecosystem.

"Te Utanganui already includes more than 80 businesses across Palmerston North and Feilding and we are seeing interest from across New Zealand. We expect interest from private sector partners to grow as these catalyst projects progress. 

The wider Te Utanganui programme is expected to unlock up to $1.5 billion in private investment over time, creating jobs during construction and supporting thousands of roles across logistics, manufacturing, warehousing and related industries as development continues.