Auckland Parnell Terraces owners ponder selling townhouses for $150k

Owners held an extraordinary general meeting on March 12.

The Parnell Terraces are on leasehold land and have had leaks and litigation. Photo / Michael Rehm

Body corporate chairman and Auckland University lecturer Dr Michael Rehm updated the meeting on his recent discussion with Addison Curd of Global Optimisation Partners (GOP) and its buyer’s agent, Wayne Maguire.

According to a Herald article last year, GOP wants to buy all the Parnell Terraces properties and other townhouses in the area and do one larger new development.

Rehm told the March meeting at Rosepark Hotel that GOP’s bank-appointed valuer had assessed the units at a lower level than expected.

As a result, GOP advised that it could not proceed with a previous offer of $200,000 per unit at Parnell Terraces.

The Parnell Terraces are on the corner of The Strand and Roynane St. The ground beneath them is leasehold.

GOP instead proposed only $150,000 per unit.

Rehm also explained that GOP must satisfy two key requirements before its offer can become unconditional.

It needs to obtain agreement from at least 76% of Parnell Terraces owners to sell at the revised price of $150,000;Its valuer must be granted short access to each unit included in the proposed sale.

According to the minutes supplied by one owner, Rehm indicated that selling could be the best outcome.

He emphasised the financial uncertainty and potential cost to owners if the body corporate continues with arbitration over the ground rent review being conducted with an entity controlled by Ngāti Whātua Ōrākei Whai Rawa.

Dr Michael Rehm, chairman of the Parnell Terraces’ body corporate and an Auckland University academic. Photo / Michael Rehm

“Even the most favourable outcome would result in a notable ongoing expense per unit,” the minutes said.

The body corporate has a significant debtors’ balance of almost $900,000 and this amount continues to increase, the minutes said.

The Parnell Terraces are on leasehold land owned by Whai Rawa Railway Lands.

Some owners expressed concern that GOP might further cut its offer in the future.

Several owners emphasised the importance of maintaining a united approach.

Any outstanding ground rent or levy arrears for a unit will be deducted from that unit’s settlement amount.

GOP has plans for a single apartment building on the site of the Cotesmore and Dovedale terrace house complexes.

“The vast majority of owners felt that the prudent way forward was to quickly proceed with signing the deed of variation,” the minutes said.

Only two owners opposed that motion, but 35 at the March meeting agreed.

And it turns out the body corporate itself owns some units.

It has agreed to sell its units, C03 and R06, for $150,000 each.

Maguire told the Herald last year the plan was to secure all the properties in the three complexes and build one apartment building.

That would combine the buildings and sites on the Cotesmore and Dovedale sites, and a second apartment building on the Parnell Terraces site.

Parnell’s Parnell Terraces are subject to a buyout by a Global Optimisation Partners, whose directors are Andrew McKenzie and Addison Curd.

The plans were for affordable housing, Maguire said last year.

Maguire said there were issues with the integrity of the floodplains along The Strand for home owners and it needed redevelopment – “it can’t stay as it is”.

Andrew McKenzie, the former chief executive of Kāinga Ora, is a director of GOP.

He headed New Zealand’s largest housing construction programme at Kāinga Ora, but resigned after the Government announced a shake-up of the state housing agency after a report found the debt-laden organisation was facing annual deficits of $700 million.

Anne Gibson has been the Herald’s property editor for 26 years, written books and covered property extensively here and overseas.

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