KEY POINTS:
Investors in Auckland's Railway Campus apartment complex face two years' loss of rental income and a bill of $6.1 million in repairs.
But the University of Auckland, which leases the building from investors, is refusing to consider proposals from a group of investors to allow temporary occupation.
The Railway Campus is a conversion and extension of the former Auckland Railway Station. Last September about 400 Auckland University students were forced out of the Quay Park block because of a leaky roof and other problems.
At the Railway Campus Body Corporate annual general meeting this week owners learned a one-year closure was now at least two years and tenders for the work were $2.1 million more than the $4 million estimate.
Despite no income, investors were told by body corporate secretary Martyn Tiller that as well as their share of the $6.1 million owners would have to continue paying mortgages, body corporate fees, and legal fees if they chose to sue the original architects, building contractor or the Auckland City Council.
Uni-Accommodation, the university-owned company that manages the Railway Campus and holds leases on the apartments until 2014, emptied it of students in February and will not reoccupy the building until recladding and heritage work is done and a certificate of compliance issued.
Owners' committee member Mike Collins told investors completion by February 2010 was a best-case scenario. Should the Auckland City Council run late in approving building consents the Railway Campus could be closed for a third year.
Lawyer Matt Josephson, a partner at Grimshaw & Co, told investors the heritage building had never received a code of compliance from the council and he estimated their chances of success in a case against the council, the builder Covington Group and the architects ADC Architects was about 60 per cent.
Collins, a member of the committee until this week's meeting, proposed owners either ask the university to take over the management of the building temporarily during repairs and let sections of the building, or to cancel the lease with the university and form their own management company.
Collins said the Railway Campus was the only leaky apartment building in Auckland to be closed fully while repairs were carried out and 80 apartments were not affected.
Collins said many apartment owners faced mortgagee sale. Investors paid up to $160,000 for the apartments in the late 1990s but one investor said the best offer she had received was $20,000.
Uni-Accommodation Limited board chairman Wayne Clark said the university planned to use the Railway Campus again for students once the work was completed, but favoured the building remaining closed in the meantime.
