River deal big on cost, short on de­tail

Waikato Times - - Opinion - Richard Swain­son

It must have come as a great re­lief to the Hamil­ton ratepayer back in July when an Au­dit New Zealand re­port ex­on­er­ated its mayor, its chief ex­ec­u­tive and a pair of lo­cal de­vel­op­ers of col­lu­sion or favouritism.

An­drew King, Richard Briggs, Matt Stark and Leonard Gard­ner were the re­spec­tive play­ers in the farce, ac­cused of get­ting a lit­tle too cosy when dis­cussing King’s plan to knock down a slew of build­ings on Vic­to­ria St.

The end goal was to fur­ther the open­ing up of the city to the mighty Waikato, com­ple­ment­ing the ex­ist­ing Vic­to­ria on the River devel­op­ment, one ini­ti­ated by Stark.

Mr Briggs’ con­ver­sa­tion with Stark and Gard­ner, a po­lite in­quiry ex­plor­ing the pos­si­bil­ity of the pair sell­ing prop­erty to coun­cil, was deemed to have in no way given the pair a ‘‘ma­te­rial ad­van­tage’’.

Dis­cus­sions were held be­hind closed doors – if not in smoke free, back rooms – be­cause of the ‘‘ur­gency and com­mer­cial sen­si­tiv­ity’’ of is­sues in­volved, es­pe­cially given that the pro­posed Waikato Re­gional Theatre site is just up the road.

News last week that the Hamil­ton City Coun­cil has paid $6.49 mil­lion to pur­chase four build­ings ad­ja­cent to the Vic­to­ria on the River devel­op­ment must also ease con­cerns the prover­bial ratepayer might have over im­pro­pri­ety.

It is true that the fig­ure paid was marginally over that of cur­rent mar­ket val­u­a­tion. The dif­fer­en­tial was a mere $2.2 mil­lion, or there­abouts. Chicken feed, re­ally, es­pe­cially for a city that’s flush with funds. If the cof­fers do hap­pen to run dry there’s al­ways that old standby, the out-of-the-blue rates hike. Hamil­to­ni­ans are an un­der­stand­ing lot, es­pe­cially when treated as cash cows. Well, not un­der­stand­ing as such, more in­dif­fer­ent.

Next to no­body votes in lo­cal body elec­tions so I guess we’ve got our­selves to blame. Mayor King’s win­ning ma­jor­ity was 6 – that’s a cost to the city of just over a mil­lion dollars per de­cid­ing vote.

Lest we be con­cerned about the ex­pense of im­ple­ment­ing his grand de­sign, Mr King re­minds us that ‘‘the value for the city is more than just money’’ and ‘‘it’s about en­sur­ing fu­ture gen­er­a­tions and fu­ture coun­cils have op­tions’’.

An un­usu­ally philo­soph­i­cal po­si­tion for some­one who in civil­ian life sells used cars, fur­nishes fi­nance to the des­per­ate and de­vel­ops prop­erty. If noth­ing else, our mayor is a deal maker.

The sur­prise about this deal is that, of­fi­cially at least, the plan is so vague. Coun­cil has no set date for de­mo­li­tion or timetable to keep. It does rather beg the ques­tion as to why the sale was so ur­gent, es­pe­cially at what at first glance ap­pears to be an in­flated price.

Ren­tal in­come, we are told, will ‘‘largely off­set the cost of pur­chas­ing the prop­erty’’. Re­ally? If so, why were the ex­ist­ing own­ers so keen to off­load such prime real es­tate? Two of the four prop­er­ties were sold by Matt Stark, a gen­tle­man, it is safe to as­sume, well known to all the ma­jor play­ers.

News that he was ‘‘ap­proached by coun­cil’’ will sur­prise no one. Stark’s mo­ti­va­tions for sell­ing, as vol­un­teered to Stuff, were en­tirely al­tru­is­tic. He and his part­ners ‘‘are not the type of peo­ple to stand in the way of a greater vi­sion of the city’’.

Stark says he sold one prop­erty ‘‘at cost’’. The other, ac­quired in a liq­ui­da­tion sale, he has pre­sum­ably re­alised a profit on, though claims he let go at ‘‘sig­nif­i­cantly un­der mar­ket value’’. His opin­ion of mar­ket value is at odds with of­fi­cial fig­ures. Such is en­tre­pre­neur­ial high fi­nance.

No doubt the same com­mer­cial sen­si­tiv­i­ties al­luded by Au­dit New Zealand in July would pre­clude any closer ex­am­i­na­tion of the sale.

The pub­lic and the press were cer­tainly ex­cluded from ne­go­ti­a­tions on these grounds. Al­most a month elapsed be­tween the clos­ing of the deal and its an­nounce­ment. Com­merce was done but it was not seen to be done.

Mayor King has spent a good deal of his ten­ure telling us how un­ex­pect­edly broke the city is. Those in­vested in des­ti­na­tion play­grounds, to name but one project axed un­der his belt­tight­en­ing regime, have been de­nied their swings and round­abouts. Yet money is mirac­u­lously found when it suits him.

Per­son­ally, I am con­cerned more with the op­por­tu­nity cost to adults of mu­si­cal dis­cern­ment.

Ni­vara Lounge is the city’s prime live mu­sic venue, a god­send to per­form­ers across a wide range of gen­res and age groups. If, as looks to be the case, we are to lose Ni­vara as a con­se­quence of this back room deal, Hamil­ton will be the poorer for it.

Hamil­ton Mayor An­drew King

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