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Man with Midas touch closes his final deal

By Chris Hutching

Friday 4th July 2003

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Howard Paterson, 50, one of the South Island's wealthiest men and renowned for his Midas touch, vision, and energy, died while on a trip to Fiji this week where he was negotiating a deal with the government of that country to set up a resort on one of the islands.

Friends and business colleagues were stunned as the reality struck home that one of New Zealand business's brightest stars had left the stage. Though they were deeply upset, they wanted to celebrate the memory of his life and carry his legacy forward. Members of the business community rallied around this week offering assistance in bringing his body back to New Zealand for the funeral on Monday afternoon at First Church in Dunedin. Flags were hung at half-mast in Dunedin this week and city councillors marked their respect with a minute's silence.

Mr Paterson was found dead in his hotel room in Fiji and a New Zealand pathologist who travelled to Fiji this week reported he appeared to have suffered an airway blockage caused by food, dispelling earlier suggestions of a heart attack.

Two weeks ago he received a clean bill of health after a medical checkup and there were no problems from a stent that was surgically implanted in one of his heart valves some years ago.

His wife, Lee, had remained behind at their home in Waikouaiti near Dunedin to look after their school-age boys, Rupert and Harry, and she was about to take them on a ski trip when Mr Paterson's brothers Grant and Greg arrived to deliver the bad news.

His older son, Matthew, by his first marriage is based in Queenstown, where Mr Paterson increasingly spent his time on various investment ventures and where he had one of his holiday homes. His father and mother live in Wanaka.

Close friend and business partner John Darby said Mr Paterson had lived the equivalent of several lives during his 50 years and his drive was legendary.

"We have the greatest regard and respect for Howard's generosity and vision and what he achieved. He often said, 'Live for the day,'" Mr Darby said.

"He was beginning to rationalise his life a little more and take a more measured pace but it was hard for him to slow down. I think that the role he'll be most remembered for is his humanity. It's relatively easy to replace a capitalist but more difficult to replace a humanist and friend.

"He was a metaphysical sort of guy. He also showed you don't need to desert New Zealand to be successful or become some sort of weird recluse afraid of people taking his money. He used to talk to ordinary people like the guy filling petrol in his car, so he touched many people."

At lunchtime on Tuesday several of Mr Paterson's local colleagues, including John Martin and Mr Darby, met for drinks at Eichardt's, the $1400-a-night boutique hotel he quarter-owned in Queenstown overlooking Lake Wakaptu.

The editor of Queenstown-based newspaper Mountain Scene, Philip "Scoop" Chandler, said the charismatic Mr Paterson was a colossal figure in Queenstown where he had his multi-million dollar crib. Taxi drivers loved him ­ he'd often keep them waiting outside an appointment but then he would pay a waiting fee as well as a fat bonus.

His greatest loves in the Wakatipu area were his rural stations, Mt Creighton and Branches, co-owned with the partners in Eichardt's. He was gregarious in local bars, had huge confidence in the local property market, and was reported in Mountain Scene a year ago as saying prime properties in Queenstown were still only 20-30% of their ultimate value.

'His was a great life'

Another close friend based in Queenstown, property developer and investor, John Martin, was a partner in many business deals over the past three decades, including the landmark Steamer Wharf development in the tourist town.

"His was a great life. He lived 10 men's lives in 50 years. He was the cleverest, most dynamic man I've ever known, an extraordinary visionary as well as a great diplomat and friend.

"He gave a lot away, was intensely loyal and he helped many people out of difficulties. He was just a star, a one-in-a-million person.

"Everything about life fascinated him. He was also very spiritual. He had a theology degree and would often come out with sayings from the great religions.

"He believed in a great being or driving force behind everything. He believed in the god in all of us. He was fascinated when a group of Buddhists established themselves at Glenorchy near Queenstown a couple of years ago and declared it was the centre of the universe.

"About six months ago he said to me, 'John, I'm the happiest man ­ I could easily face death if I had to.' Maybe he had a sense of something. He loved the grandeur of Central Otago and the South Island ­ the mountains, the beaches and the lakes and recently he'd become more preservation-minded.

"He had such boundless energy and enthusiasm. Paddy didn't come to business in conventional terms at all. Who would ever think he'd build the biggest egg farm in the country or more recently buy a jam factory. But he could see that when he approached supermarkets it would complement the eggs, the venison and the milk he was providing.

"A few weeks ago he rang me and said, 'Guess what, I've bought a business with 40 kayaks in Tasman Bay.' Of course it was the underlying property that interested him.

"When we were really young at university he'd be up at 5am and he'd get down to the Otago Daily Times offices to get the newspaper before anyone else. By the time I was up at nine o'clock he'd have earmarked all the good properties and sometimes already had an offer down.

"He was a voracious reader and drank up information on everything. Politically he was very pragmatic and disliked the economic effects of the Brash-Bolger years when the high currency was hitting primary exports.

"He would have been one of New Zealand's most significant persons and it's just so sad we've been robbed of a great leader. I know he'd want us all to be happy and keep on thinking and doing things," Mr Martin said.

Glass always three-quarters full

Dunedin businessman Eion Edgar was amazed at Mr Paterson's ability to identify trends about three years before anyone else, carry out the research and take the concept to fruition by putting together a good team and leaving them to get on with it.

"People say he was lucky but he did a lot of homework and then he put in enormous energy to make it happen. He was also tremendously loyal so when he had floats it would be his friends and colleagues who had been with him who were offered a piece of the action first.

"He had a great ability to make people feel at ease and he would have done well in whatever country he was in but he usually preferred gatherings of old friends and colleagues rather than public functions. He was incredibly positive. As far as Howard was concerned the glass was always three-quarters full," Mr Edgar said.

A natural leader

One of Mr Paterson's key legal advisers was Jim Guthrie, who said his modus operandi would ensure the survival of the businesses he set up.

"He had a vision that was far more prescient than the rest of us and had a great conviction that his judgment was sound and that what he thought would happen did happen, so other people picked up on that confidence and things did happen. He was a natural leader.

"If you look at his portfolio of interests there are few of them where he has 100% ownership. He was incredibly generous and would always invite friends and associates to take a share in these companies.

"He was also aware of his own strengths and weaknesses and set up partnerships with people who had complementary skills."

As a result, Mr Paterson has numerous 25% shareholdings in the ventures he set up and the other partners will continue to run them.

Mr Guthrie said there were no plans for a major review of Mr Paterson's portfolio, although there may be some deals in the making that will not proceed.

Other close friends and investment partners of many years who will take his legacy forward include Bernie O'Donnell, David Smallbone, and Dougall Rillstone.

Empire will continue

A recent venture Mr Paterson was setting up was New Zealand Land Trust with Dunedin colleague Mike Coburn and Queenstown-based John Darby.

Mr Coburn has enjoyed a 20-year friendship with Mr Paterson and the pair were about half-way though developing the Lake Hayes Estates residential subdivision near Queenstown. It proved so popular that local real estate agents introduced a booking appointment system for buyers when it was launched last year.

Land Trust was set up to identify property-buying opportunities following the expiry last October of a five-year restraint of trade arrangement that Mr Paterson had with listed Southern Capital. In that deal he and fellow founding director Phil Burmester were paid $1.5 million each on the basis that they would bring all their deals to Southern Capital, which would have first choice.

The expiry of the restraint of trade deal possibly explains why Mr Paterson recently introduced the business of Hirequip to Southern Capital, providing it with a back-door listing and reducing the level of the property activities and assets to about half of what they were.

Land Trust would have been in a good position to take over some of Southern Capital property development as that company evolves solely as a hire equipment business.

Mr Coburn said the original philosophy behind Land Trust would continue.

"Howard may not be here physically but his spirit will be. He had outstanding enthusiasm. Just meeting with him was a tonic. He was infectious. I'd talk to him for five minutes and come away feeling totally changed.

"He had a belief in people that was genuinely sincere. His empire will continue. He had such a huge global network and he set up structures that will continue," Mr Coburn said.

Inspirational conceptualising

Clearwater Resort on the outskirts of Christchurch was one of Mr Paterson's biggest property developments in recent years in partnership with John Darby and Diana Lady Isaac although he visited the site only a couple of times, including its opening function last year.

According to Clearwater development director Justin Prain, Clearwater is an example of the consummate patience of Mr Paterson over a 10-year period of development, most of it taken up in overcoming Resource Management Act issues that paved the way for a potential $300 million series of luxury residential developments, half of which have been sold.

"Howard was inspirational in his conceptualising of the project. He often joked it was God's work. It was interesting that he didn't find much wrong with the Resource Management Act. He used to say, 'Don't treat it as an obstacle ­ embrace the RMA,' and he used to encourage us to work our way through it but we were never instructed to try to take short cuts. He was pragmatic.

"The overriding thing about Howard was that he was joyful, he was such fun to be with. He loved to party, enjoyed his wine and beer but always remained lucid.

"He wouldn't brook any negativity, he would just turn away from it because he didn't want to waste his energy, so he'd just find his way through or around obstacles.

"Howard and Phil Burmester were a great team when it came to finding property deals. Phil was the hunter and Howard made sure it would work and he had the financial grunt to make it happen.

"But it was the kind of relationship that couldn't survive the regulated and formalised structure of a listed company [Southern Capital].

"He loved being mystical and often talked about the phenomenology of religion, which he studied at university. He was free-wheeling and free-thinking and the range of his investments shows that.

"It was probably only recently that his wife, Lee, encouraged to him to think that it was appropriate for him to sit around on a beach and take time out. I think he was starting to get the hang of it," Mr Prain said.

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