Dear Reading owners, some answers please
Dear Ellen and Margaret Cotter, millionaire owners of the Reading empire, Los Angeles.
We understand from Sam Farrell, the account director at Acumen, who has asked that all media inquiries for you come through him, that you would rather not comment on the $32 million deal you have hatched with Wellington City Council.
We have also been to the $2.5m Khandallah home of Steven Lucas, a director of your New Zealand arm, but, again, no luck there.
But, you see, we here in Wellington are in a rather tight spot financially and it would be smashing to get some questions answered as we look to hand over $32m.
We this week were told that rates would likely soon go up by 16.4%, which is really 18% if you add in an additional levy for most. This comes on top of rates rises in the past three years of 12.8%, 8.8%, then 12.3%.
You may have noticed, as you made your way to the delightful Ortega Fish Shack for a ratepayer-funded dinner, that the city is awash with leaky pipes. You may have also noticed a pothole or two, or a scourge of homelessness, or a hospitality industry hanging on by its fingernails, an array of closed quake-prone buildings, or a city amid a living cost crisis.
I tell you this as a way of explaining why it really would be good to get some questions answered, because each of these issues could be helped with ratepayer money.
But Wellington City Council is looking to sell land, so it can buy land under your Courtenay Place complex, which has been closed since 2019, in an effort to get you to fix it and open it again.
Many have pointed out that the land the council currently has will appreciate in value but the deal you have with the council means you can buy the land back for the same $32m in 10 years’ time and you, not us, get the capital gains.
So, again, it would be great to get some answers:
1. You in 2022 told shareholders that the company planned “a top to bottom renovation of this theatre’’. There was not then any council involvement. What’s caused the change?
2. The 100 Courtenay Place land, where the cinema is, has gone up from $3.04m when you bought it in 1999 to $32m now. How much does Reading expect the land value to appreciate in 10 years’ time, when it can buy it back for $32m?
3. What happened to the $27m insurance payment you received for the car park after damage caused in the Seddon earthquake?
4. What guarantees can you make that you will actually build the cinema after taking $32m from the council?
5. Will Reading accept an invitation to front up to Wellingtonians and answer questions about the deal?
6. Given Reading in 2023 opened two Australian cinemas without need of public money, why do you need help from Wellington ratepayers?
7. How many trips to Wellington have Reading executives taken to work out this deal? Did the council foot the bills?
8. Do you understand why the council rejected an offer from philanthropist Sir Mark Dunajtschik to buy the land, where you would have been able to reopen the cinema. Were you open to this offer? Did the council put it to you?
9. Is Reading paying full rates on the site? If not, why? And what is the discount?
10. How often are rent reviews under the deal? Will they be at the end of each 21-year renewable lease or sooner?
11. Why have you not met with all councillors as the ultimate decision-makers on the purchase of the land?
12. What are the estimated costs to fix the cinema building?
13. What are the plans for the adjacent sites owned by Reading?
14. Is Reading planning to reinstate the cinema, bearing in mind that other US cinema chains have recently filed for bankruptcy?
15. Will you consider releasing any structural reports you have commissioned into the building?
16. As Reading is relying on ratepayers for its seed capital, does this raise questions about Reading’s financial capacity?
17. What are the concept plans for the site (and adjacent sites owned by Reading)? These may give ratepayers comfort that the area will be redeveloped.
18. This deal is not commercially sensitive, as it’s not a competitive situation, so what are Reading and the council so afraid of? Why not have a public discussion?
19. Why is the council putting in ratepayers’ money first, then Reading when it is Reading’s property? Why should ratepayers put skin in the game before the property’s owners?
20. If the council guaranteed the $6m (rather than paying it), Reading could go to a bank to arrange finance. Why is this not being done?
21. If reconstruction costs exceed the budget, will Reading approach the council for additional funding?
22. If Reading is so committed to Wellington, why has nothing happened since the cinema was closed?
23. What would you recommend at the Ortega Fish Shack, where you enjoyed a $1400 meal for 10 people at ratepayers’ expense?
Yours, broke and leaky of Wellington.