The Billionaire and the Bay
A Russian billionaire did everything in his power to win over a poor Northland community, but his recent request is now causing resentment. Madison Reidy reports, images by David White.
Guests paying thousands to stay at a private luxury lodge in Northland are oblivious to the state of the ramshackle town it is nestled in when they arrive by helicopter. They do not see the sheds with smashed windows that some locals call home, the decrepit buses and written-off cars piled in paddocks, and barefoot locals picking vegetables from muddy creeks to feed their family.
The ultra-wealthy guests of Russian businessman Alexander Abramov’s $50 million mansion in Helena Bay, a small coastal town 40 kilometres north of Whangarei, enjoy a famous Italian restaurant, European-styled living quarters finished with an indoor spa and a 25-metre heated swimming pool.
It could not be more foreign to the lifestyle of neighbours who live in one of New Zealand’s poorest areas.
But the locals do not mind too much because, as one says, the Russian billionaire has ‘‘waved money around’’ the struggling Whangaruru district. Solving their woes like fairy dust.
However, his recent request to the local council seeking permission to irrigate up to 60,000 litres of water a day from the local stream to keep his gardens green in summer bypassed iwi, and has upset some neighbours who gather food from the stream.
It appears that Abramov was well advised where to spend his cash. Before, during and after the six-year construction project starting in 2010, his application to build New Zealand’s wealthiest residential property ticked every goodwill box available.
Grant private beach access to the local Ngatiwai iwi? Tick. Plant native trees, wetlands and set up an on-site farm? Tick. Employ 130 local people straight after the 2008 global financial crisis and graduate eight carpentry apprentices? Double tick.
His generosity included lending construction machinery and project managers to clean up the iwi’s Mokau Marae meeting house after it burnt down in 2013.
Abramov’s New Zealand spokesman Chris Seel says the Abramov family is 100 per cent committed to supporting the community and boosting Northland’s tourism sector.
‘‘We are a bigger newcomer than anyone else has been in the past, you have got to make a real effort to meet people, to explain what you want to do, to build a level of trust. We made a real effort to engage the local community.’’
Seel rejects any suggestion that Abramov has tried to buy the community's affection.
Abramov’s property has invested in the community ten-fold the amount promised in his Overseas Investment Office submission, he says.
Hapu representative and Whangaruru resident Huhana Lyndon says the ‘‘frivolous nature’’ of Abramov’s request to take 60,000 litres of water to keep his imported lawn green ‘‘raised a hackle straight away’’.
Seel says he regrets not notifying iwi of the request and one of his colleagues had since apologised. Seel would not say whether the apology admitted a misunderstanding of Maori beliefs.
He says he and Abramov took extreme caution to consult the iwi at every step.
Ngatiwai Trust Board chairman Hadyn Edmonds says he is comfortable with Abramov irrigating with water from the stream.
‘‘You will always have different points of view depending on what people do or do not know.’’
But the slip-up has left a bad taste in the mouths of some locals.
Lyndon says locals pay almost $600 to have water delivered by truck when their tanks turn dry every summer.
No one is allowed to take water from the stream without local council approval. Even with approval, most do not have the expensive pumping tools to do so, she says.
‘‘[Approval] should not be based on who has the most money to get to the front of the line.’’
Seel defends the irrigation, saying that water is to be taken from the flood-prone stream only metres from the ocean.
He says keeping grass green is not a petty reason.
‘‘What is the purpose of water? It is to create life. We are growing grass, I do not think that is frivolous at all.’’
Another resident, Johnny Seve believes the council approved it because the size of Abramov’s cheque book gave him a type of special privilege.
Seve says the request and its approval was a ‘‘slap in the face’’ to Maori whose culture deemed water sacred.
Lyndon says Abramov’s irrigation request was the community’s first run-in with him and it took most by surprise.
She says it has changed attitudes towards him, and many are worried about what he might ask for next.
‘‘Will this become a big-brother relationship? The have and the have-nots?’’
Lyndon believes a divide has been created in the community between the 50 or so farmers, landscapers and wait staff who work at the lodge, and those who don’t.
Helena Bay cafe and gallery owner Peter Brown speaks fondly of the easy-going Abramov. If you know him well enough, his greeting is a bear-hug. His former British Special Air Services bodyguard looks on, but does not usually flinch.
Abramov and his wife once bought a kauri coffee table from Brown.
The wealthy guests are prone to the occasional art purchase too. One New York property developer staying at the lodge has just bought a $21,000 corrugated iron sculpture of a moa. Brown says it was one of his biggest sales in 20 years of business.
According to the Forbes World Billionaires’ List, Abramov made his US$4.5 billion exporting metal out of Siberia and buying steel companies amidst Russia’s 1998 financial crisis.
Brown says Abramov spends his time in Helena Bay deep-sea fishing and playing golf at the spectacular Kauri Cliffs course.
He believes he is the ideal overseas investor, comparing him to US business mogul Peter Thiel, who was controversially granted New Zealand citizenship after spending only 12 days here.
‘‘It has been very positive for the district as far as our local oligarch goes.
‘‘I think they [foreign investors] need to add value … and he sure as hell has done that.’’
Seel says Abramov and his family love New Zealand but will not comment on whether he is considering citizenship.
But he agrees that Abramov’s contribution to the local economy is ‘‘enormous’’.
He says the lodge is the ‘‘golden goose’’ that will continue to benefit the community by employing locals and bringing in rich tourists willing to spend upwards of $50,000 a visit.
‘‘We can go away with a clear conscious knowing that we have really delivered substantially to the whole community. I think it is just overwhelmingly obvious that we have done that.’’
But Seve, who eats the watercress he picks from the muddy creek an arm’s length from Abramov’s automatic gates, is not convinced.
‘‘Life is not fair … money talks. It is no different when someone comes in and just waves money around.
‘‘We are not as open in this country about people who can come in here and buy their way. It is probably our worst-kept secret.’’