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Luxury Whakatane apartment complex leaves $15m debt

Friday 31st December 2010

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The developers of the luxury Quayside apartment complex in Whakatane have left a debt of almost $15 million, according to receivers.

Failed company Quayside Trustee's debts exceed $14.7m, too high to be offset by the sale of unsold apartments, which have been marked down substantially in a saturated Whakatane property market.

Twenty-nine of the 43 apartments in the George Street complex remain unsold. They are being offered for sale at an average price of $380,000, or $11 million for the lot. Prices have been reduced by $100,000 and more.

Secured creditors are the ANZ Bank and Fidelity Finance, which were owed $10.8 million and $4.0 million respectively when receivers Andrew McKay and John Cregton of Corporate Finance were appointed on September 8.

At that time, the receivers said preferential creditors - which include Inland Revenue and employees - were owed $1.5 million, while unsecured creditors were estimated to be owed $1.6 million.

It was unlikely there would be sufficient funds to meet the claims of unsecured creditors, they said.

Between the date of their appointment and November 5, the receivers obtained $191,000 as a refund from Whakatane District Council for Quayside Trustee's development contribution, including interest and GST.

Deloitte's court-ordered liquidation report on behalf of all creditors showed Quayside debts had been reduced from nearly $18 million to $14.7 million by October 14.

Quayside Trustee was incorporated in 2005 with three shareholders - accountant Greg Robison, developer John McColl and architect Mark Tatton, who designed the Quayside complex.

The apartment complex was finished in November 2009, about a year behind schedule.



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