RSA may sell $8m property
The Christchurch Memorial RSA (CMRSA) is proposing to sell its new $8 million headquarters amidst allegations of mismanagement and obstruction.
The association has sent out a postal ballot asking members to vote on a possible sale of its Armagh St property that it has owned for more than a century. The sale proposal needs a twothirds majority to go ahead and closes on June 15. A letter accompanying the ballots outlines the body’s precarious financial position, which stems from the failure of its flagship Trenches Restaurant Bar and Events business that operated at the site.
Trenches is the trading name for Christchurch RSA Holdings Ltd, which went into liquidation in January owing a substantial amount to creditors including its parent body, CMRSA. Liquidators are still investigating.
The CMRSA, in turn, owes about $1m to ANZ bank and another $775,000 to its Museum and Support Trust, which runs 29 social housing units in Aranui. An insurance payment for damage to the units in the Canterbury earthquakes allowed the trust to make the $775,000 loan. The money was used to help fund the new Warren and Mahoney designed headquarters that cost about $6.5m and open in 2015.
The letter claims former CMRSA president Pete Dawson, who was also a director Christchurch RSA Holdings, has some responsibility for the body’s current troubles.
‘‘While definitive information and conclusive evidence is still in the research state, it is becoming clear that the reason for the failure of RSA Holdings Ltd is due to mismanagement by certain senior members of the CMRSA who also served as directors of RSA Holdings Ltd,’’ it says.
‘‘It is also apparent that advice received from professional advisors to the RSA Holdings board, including the ANZ Bank, the accountants and the auditors, was not only ignored but deliberately withheld from some who had a right to know, and that had they known, a different outcome may have eventuated. It was only because of the resignation of the past-president that a meaningful investigation was possible.
After Dawson resigned in January, the honorary treasurer was able to conduct an ‘‘exhaustive analysis’’, the letter says. The analysis reached the conclusion the CMRSA was unable to meet outgoings associated with the mortgage and other loans, it says.
Dawson has long been a powerful figure within the RSA and was instrumental in the decision to sell part of the RSA’s property, which ran between Gloucester and Armagh streets, to raise money for the new headquarters on the Armagh St side of the property.
He was also the managing director of Cryptopia, a cryptocurrency exchange that went bust last year after being hacked in a $30m heist in January 2019. The exchange was holding cryptocurrencies worth about $170m and had 800,000 account holders with a positive coin balance.
Dawson, now retired, said he had no comment on the allegations.
The new president of the CMRSA, Jim Lilley, said he couldn’t comment while an independent investigation of all his organisation’s entities was in progress.
‘‘I’m not suggesting anything but something went wrong and it’s only common sense to make sure there’s nothing else lurking in the dark,’’ he said.
The CMRSA was still looking at options other than selling the Armagh St property.
The site’s connection with returned servicemen and women goes back almost a century. It was where injured soldiers returning home from Gallipoli established the Christchurch Returned Soldiers Club in December, 1915, in a building known as Jellicoe Hall.
The club was the first organisation of its type in New Zealand and pre-dated the national RSA which was founded the following year.