Creation Of NZ’s Largest Inland Port Set To Boost Primary Exports

A landmark $3 billion privately funded development in Otago is set to create New Zealand’s largest inland port, boosting the export capacity of the country’s primary industries and future-proofing South Island freight logistics for the next century.

Dunedin’s seaport is NZ’s sixth largest by export volumes and provides critical access to sea freight for Otago and Southland’s forestry, dairy and aquaculture sectors. Capacity constraints at Port Chalmers have threatened to impact the region's economic growth, with a search for alternative sites underway.

The Milburn Quadrant development, located north of Milton, will span over 200 hectares, including a 55 hectare inland port, and connect directly to State Highway 1 and the South Island’s main trunk rail line. The site is already zoned for heavy industrial use and will require no public infrastructure investment.

The logistics facility will also take thousands of heavy truck movements off Dunedin roads, improving road safety and significantly cutting CO2 emissions and road maintenance costs.

Mark Johnston, Land & Delivery manager at Calder Stewart,Milburn Quadrant’s developers, says the new regional infrastructure will act as a ‘pressure relief valve’ to address storage capacity constraints at Port Chalmers.

He says freight volumes from Central and South Otago are forecast to grow 30-40% over the next decade, driven by seasonal peaks in forestry and dairy exports.

“Milburn is a shovel-ready, future-facing development that solves real capacity issues for our exporters. It’s fully privately funded, so it won’t burden ratepayers and offers the scale and connectivity our regional economy urgently needs.

“With Port Chalmers facing container storage limits and the cost of upgrading alternate sites like Mosgiel projected at over $100 million in public spending, Milburn offers a scalable, investment-ready solution designed to meet the growing needs of the Otago-Southland region, without placing an immediate burden on ratepayers or requiring upfront public funding.

“This region is heading into a logistics bottleneck. Without scalable inland port infrastructure, exporters will face rising costs, road congestion and lost opportunities. We estimate Milburn could eliminate over 10,000 heavy truck movements per year by shifting volume to rail.

“There is also a significant amount of farming land being converted into forestry in the lower South Island. These exports are bulky, seasonal and require staging and storage and cannot be stacked vertically like shipping containers. A larger site like Milburn can buffer this better than smaller, fragmented hubs.”

Calder Stewart has already completed Stage 1 of the project, a state-of-the-art campus with offices and a 10,000 sqm steel fabrication facility at Revolution Hills. The company will also build out the inland port infrastructure using its own property, design, manufacturing, construction teams and plant.

“In addition to being New Zealand’s largest industrial landowner, we’re also a vertically integrated property development and construction business with decades of experience in building large-scale infrastructure. With concrete, steel, cranes and a local labour force already on-site, we can deliver faster and more efficiently than anyone else in the market,” Johnston says.

The company expects construction on the inland port to begin within 24 months, subject to resource consent approvals. The development could ultimately accommodate 400,000-600,000 twenty-foot equivalent unit (TEUs) annually, significantly lifting the region’s export throughput.

In a first for the New Zealand market, all new buildings at Milburn Quadrant will include rooftop solar generation, funded and installed by Calder Stewart Energy Limited. Once complete, the development has the potential to generate up to 50MW of power, which could be used on site or distributed to the local community.

A 350 kW solar system is now fully operational at the company’s steel fabrication facility, marking the first stage of the development and a key step toward its renewable energy vision.

“Occupiers will benefit from hedged solar pricing and building owners will share in the returns. It’s a self-funded energy model that’s already been submitted for national innovation awards,” says Johnston.

The precinct will also include 30-metre native planting buffers, walking trails, bridges and cycleway integration with the Clutha Gold Trail.

“Milburn Quadrant will support hundreds of jobs, unlock industrial growth, and give exporters a long-term solution they can trust,” says Johnston.

John D’Arcy, lower South Island business development manager of Property for Calder Stewart, says the company is now seeking local government support to fast-track approvals and will present the proposal to government officials and stakeholders in the coming weeks.

“Port Chalmers is approaching logistical constraints, particularly around container storage and log volume. A delay in new inland capacity risks bottlenecking exports and eroding competitiveness.

“This is about real economic transformation, securing long-term freight capacity, creating hundreds of jobs, and easing the pressure on urban roads and infrastructure.”

“Milton is strategically positioned closer to the region’s agricultural producers, where the bulk of freight originates. That’s where rail delivers the greatest benefit, with both carbon and cost efficiency improving over distance. It’s a smarter, more sustainable hub for Southland and Central Otago producers.

“What we need right now is visibility, political backing and certainty around regulatory timelines. With the right support, we can secure Council approvals and ensure the public understands the scale and value of what’s being built here,” says D’Arcy.

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