Valuation of contentious city buy falls

The Hamilton City Council’s controversial inner-city Victoria St buildings are now worth $2.37 million less than the $6.49m ratepayers paid for them almost three years ago.

The latest independent valuation of the properties between 242 and 266 Victoria St put the total value of the buildings at $4.12m, show reports released to the Herald under the Local Government Official Information Act.

Their value has even dropped below the 2018 market valuation of $4.3m. Both independent valuations were carried out by Telfer Young.

And the council has just seven years to do something with the buildings or it is contractually obliged to sell two of the three back to the prior owner at the market value, currently well below the purchase prices.

The latest assessment, last June, valued 242-254 Victoria St, whose tenants include Mexico, at $2m despite council paying $3.4m for it, 260 Victoria St is put at $650,000 compared with its $790,000 purchase price and 266 is $1.470m despite council paying $1.95m for it.

When buying the properties former mayor Andrew King dismissed suggestions the council had paid too much.

Telfer Young noted the CBD retail market was soft, particularly with hospitality tenants being most affected by last year’s lockdown. The properties’ overall value has dropped $180,000 since its 2018 valuation.

Hamilton deputy mayor Geoff Taylor, who had backed the buildings’ purchase, says they have great potential for redeveloping.