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Busy first six months for Southern tycoons

By Nicholas Bryant

Friday 10th March 2000

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Southern Capital, the star-studded investment vehicle that listed on the back of CBD Properties last year, has released steady financial results for the six months since amalgamation.

The group, which includes ex-Brierley Investments guru Graeme Wong and noted South Island investor Howard Patterson, has been busy with diverse investment initiatives ranging from mussel farming to a possibly $50 million residential and business park at Pegasus Bay near Christchurch.

It reported a profit of $520,000 due largely to option fee income for the on-sale of its 500ha Orere Point property north of Auckland.

The most successful of its projects so far has been stage one of its Omaha Beach residential sections also north of Auckland.

Sales of sections started slowly but have been steady since Christmas, with 74 of 116 sold at a value of $30 million.

Top-of-the-line beachfront sections have changed hands for about $600,000, with at least one already on-sold for a $150,000 profit.

Mr Wong said the extension of State Highway 1 north of Albany cutting commuter times to under an hour to downtown Auckland had helped sales, while Transit New Zealand analysis had shown the weighted average cost benefit of completing the highway through to Puhoi would be about 5.9 times the capital expenditure of $228 million.

In another development the company was frustrated with what Mr Wong called the "very disappointing" attitude of the Canterbury Regional Council which has objected to a 5000-resident new town at Pegasus Bay.

Mr Wong said the plan had been supported by the Waimakariri District Council but the regional council had an imperative which was extremely focused on public transport and objected to future residents commuting the 15 minutes to Christchurch.

He said the objection had touched on a huge range of issues from concern about destroying the world's non-renewable resources to pollution to motorway congestion and increasing accidents.

No Environment Court date has been set but Mr Wong said there were ways to overcome the problems.

Southern Capital is also planning a major mussel farm in Marlborough's Clifford Bay.

Initial plans were for about 1700ha of mussel beds but if approved the project is likely to be somewhat smaller.

Mr Wong said he thought it unlikely any conflict with Tranz Rail, which has expressed an interest in a ferry terminal at Clifford Bay, would arise but the company would have an opportunity to put any concerns before a statutory public hearing.

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