Housing New Zealand flats in Rolleston St, inner Wellington, look set to be redeveloped and it has been suggested it would be a good location for the country's first "wet house".

New Zealand's first "wet house" could be set up on the fringe of Wellington's inner city, in Mt Cook.

The proposed Housing New Zealand complex would accommodate homeless alcoholics and drug addicts, and allow the alcoholics to continue drinking, under round-the-clock supervision.

Housing NZ is currently planning the redevelopment of its Rolleston St flats in Mt Cook, and it is understood the "high-dependency" home, to be called Te Whare Okioki, could be part of the new complex.

STUFF Brian Dawson, who holds Wellington City Council's social development and housing portfolio, said Te Whare Okioki would accommodate homeless people with high-dependency needs.

The wet house plan is being driven by Wellington City Council, in partnership with Housing NZ and the Ministry of Social Development (MSD).

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Delivering a wet house was a key election promise for Wellington Mayor Justin Lester. He said the project was progressing well, but there was still more work to be done, which would take some time.

CAMERON BURNELL/STUFF Stephanie McIntyre, director of Wellington Downtown Community Ministry, with Wellington Mayor Justin Lester when he announced his plan for a wet house in Wellington. The project is progressing well but there is still more work to be done, he says.

Rolleston St was close to the central city and support agencies, and it had the potential to be a strong site. However, it was not yet guaranteed.

He said he was committed to reducing homelessness in the city, and Te Whare Okioki was one of the best opportunities to do so.

Brian Dawson, who holds the social development and housing portfolio, said no plans were set in stone, but confirmed Rolleston St was a site being discussed.

The redesign of the Rolleston St flats was seen as a good opportunity.

"There is still a long way to go on this, because of the complexities and the various elements needed."

A lot of work was being done on how to operate Te Whare Okioki, and the best option would not be cheap because it included 24-hour supervision.

"It is not just a wet house. It is a home for people who have high-dependency needs," he said.

In a letter sent to Rolleston St residents on Friday, Housing NZ said no decision had been made about the site.

"We already provide homes for people who in some cases have complex issues and needs, which could also include alcohol dependency," it said. "We want to explore how we can better connect them to specialist providers who can provide the right level of wraparound support on-site.

"This is a supported living model, not a wet house, where people can access the help they need in a secure environment. Again, no decisions have been made, and we'll keep the community updated on our plans for Rolleston."

In September, council documents described the resources needed for the project as "moderate", and dependent on funding from MSD and other government agencies.

MSD deputy chief executive of housing Scott Gallacher said no decisions had been made about funding at this stage, because it was still working through the details of what was proposed.

"Our focus is to bring 'Housing First' to Wellington by winter this year, a programme that is making headway in Auckland in housing the most vulnerable people with the greatest housing need.

"These are often people who have been sleeping rough and who may be dealing with addiction or other mental health issues. We're very excited about Housing First's potential to make a real difference in Wellington."