Centre at risk without fast cash
The Grand tourist centre overdue to open in Christchurch’s Cathedral Square is in “a very precarious” financial position, its founder says.
Director Darin Rainbird says without an immediate loan or investment, the venture is at risk.
Under development in the heritage former Post Office, The Grand is to include a bar called 1879, Stamps restaurant, a bakery, a gift store, an i-site tourist information centre, and a large outdoor plaza.
The double-storey premises are leased from owner Gordon Chamberlain, who has completed extensive earthquake repairs.
The Grand was launched in 2020 and has faced successive delays, most recently over financial issues. The Covid pandemic also stalled progress.
Rainbird said they needed $900,000 in the form of a loan or shareholding to open the doors.
He said 80% of the build for stages one and two is complete, as is 95% of the i-site, which is operating temporarily from The Novotel hotel nearby until the new office is ready.
He said three investors put up a total of six properties in Vietnam as their shareholdings, but The Grand had been unable to sell them.
“We’d expected we would’ve sold at least two of them by now, but the real estate market over there has stagnated.”
They had spent several weeks unsuccessfully trying to get a bridging loan, he said.
“We’ve got bills two pay. We’re so bloody close – just two months away – it’s very frustrating.”
Rainbird said he was prepared to relinquish his own stake in the venture if needed. He estimated this would be worth over $1 million, and was the culmination of four years’ work.
“We’ve had exceptionally bad luck, or bad management.
“It would make sense if someone else could come in and take it over. It’s my responsibility as CEO and shareholder to protect the shareholders, staff and contractors, and find a solution.”
He said market research indicated the business would be very successful if they could open the doors. He estimated its worth at $5m.
Rainbird believed The Grand could make between $120,000 and $180,000 in yearly advertising revenue once it opened.
The company has about 60 shareholders, most owing less than 1% of the company. Rainbird holds 72% of the shares, while businessman Murray Cleverly has the second largest shareholding.
Late last year, it was reported that the company behind the complex, The Grand Cathedral Square Ltd, which has Rainbird as the main shareholder plus multiple smaller shareholders, had spent $3.5m, including buying $800,000 worth of equipment.
It was said that shareholders had put in between $500,000 and $50. Some workers on the site had also taken shares in the company as part-payment.
In December, Rainbird said they had been “badly let down” by two overseas investors.