The council spent nearly $14 million on real estate with a house it knew was leaking

The 14.6 acre property at 516 Ladies Mile, Queenstown was purchased by the Queenstown Lakes District Council in 2019.  It was the highest home sales price in 2019.

DELIVERED

The 14.6 acre property at 516 Ladies Mile, Queenstown was purchased by the Queenstown Lakes District Council in 2019. It was the highest home sales price in 2019.

The Queenstown Lakes District Council paid nearly $14 million for a luxury home property that it knew was leaking and has since developed toxic mold.

Plans to use the large house on the Lake Hayes Ladies Mile highway as a community facility have now been ditched and it appears destined for demolition.

However, a council spokesman said the house was never intended to be used and that the high price was paid for the strategically located piece of land.

In early May 2019, the council publicly confirmed that it had purchased the large family home and 14-acre property for $13.78 million.

READ MORE:
* Auckland family eats outside on mats to prevent mold in Kāinga Ora’s home
* Municipalities should crack down on moldy homes, says rental advocacy group
* More than two years later, the future of the poisonous Kāpiti library is still uncertain

It was at the center of new Queenstown developments housing thousands of homes and could potentially be used for sports fields, parks, a transport hub or a new school.

At that time, Mike Theelen, chairman of the council, confirmed that council officials had completed due diligence before recommending elected members agree to the purchase.

It was the highest price paid for a home that year, with a purchase price of $15.5 million. Because the seller was not GST registered, the municipality was able to claim GST on the transaction, reducing the net cost to $13.78 million.

In February of this year, the council announced it would open a new community center in the house by October 2022, with a budget of $3.7 million.

STUFF

The nightmare of leaking, rotting houses first emerged in the 1990s. It has cost homeowners billions of dollars. (First published September 2020)

However, on Oct. 11, the council said it was taking a “fresh approach” after toxic mold was discovered behind the building’s cladding.

The trim, all windows and interior frame panels would require replacement, which would cost significantly more than the allocated budget.

Simon Battrick, the council’s sports and leisure manager, said at the time that the council never intended to reuse the existing house when it was bought, but were considering using it as a temporary facility at the request of councillors.

More than 300 people visited a public open day in March.

The view of the 14.6 ha site.

DELIVERED

The view of the 14.6 ha site.

“But after engaging an architect during the design phase, we discovered problems with the cladding that would not have been apparent until then,” he said.

Documents released to Stuff under the Local Government Official Information and Meetings Act revealed that the council commissioned a report from a building surveyor before purchasing the property in 2019, which revealed many instances of water damage and elevated moisture readings.

Some exterior trim was in poor condition, there were cracks in the plaster, water damage was visible in two rooms, and there was mold above the laundry.

The paint and plaster system was in urgent need of repair and further invasive investigations were recommended.

However, nothing was done until March this year when an investigation found toxigenic mold Stachybotrys in the building.

According to the report, mold is common in leaky buildings.

Its presence indicated that the samples taken had been “exposed to elevated moisture conditions that may be inconsistent with sound building practices and/or weatherproof design,” according to a follow-up report.

A council spokesman said the 2019 report has been shared with councilors and reviewed by the council before finalizing the purchase.

The Queenstown Lakes District Council purchased the property for its strategic value.

Debbie Jamieson/Stuff

The Queenstown Lakes District Council purchased the property for its strategic value.

The property was purchased primarily because of the strategic value of the land and the condition of the building was not factored into the negotiations, he said.

At the time, the municipality did not intend to reuse or demolish the building.

The future of the building now rests with the new council, which will be given options to install one or more temporary buildings for use as a short-term community center, or to put forward plans for new construction as part of the next long-term of the Township. term plan.

Leave a Reply