Westin collapse hits Asian investors

One of the rooms in the Westin Lighter Hotel. Photo / Supplied

Foreign investors are the biggest losers in the collapse of The Westin Auckland Hotel management business.

About 100 Asian buyers poured millions into the ritzy waterfront five-star property where Lighter Quay Hotel Management, the company that leases the rooms from the mainly Asian investors, has fallen into the hands of receivers.

A list of creditors in a now-failed compromise deal to be managed by Melzter Mason Heath revealed the names of the investors who bought suites in the $130 million, 172-room hotel.

Months ago, money stopped flowing to 122 investors, said to be mainly Singaporean. They are claiming $5.9 million.

Nigel McKenna, the hotel's developer and owner, sold many suites in Singapore. British investor, GDF-1 LLP, is one of the largest creditors.

McKenna's Melview Viaduct Harbour (in receivership) is the single biggest creditor, claiming $1.2 million. Most of the creditors are claiming about $40,000 each.

McKenna is the sole director of Lighter Quay Hotel Management, wholly-owned by his Melview Viaduct Harbour which also fell in the receivers' hands. Melview Viaduct Harbour is wholly-owned by McKenna's LQ Trustees.

KordaMentha's Michael Stiassny and Brendon Gibson were appointed receivers of two McKenna companies but who appointed them was undisclosed.

Their entry into the hotel was the result of weeks of failed negotiations between Lighter Quay Hotel Management and its creditors, they said.

Stiassny hoped the Westin would stay open but he can give no cast-iron guarantees.

"Since opening in 2007, The Westin Hotel has remained popular with locals as well as other domestic and international guests. It is fully booked for the Rugby World Cup. We want to reassure investors, the hotel operator, staff, suppliers and guests to the Westin Lighter Quay that it is our intention for the hotel to continue to operate as usual," Stiassny said.

His positive view is the opposite of McKenna's, who told the Herald last month that the place had been running at a loss since it opened three years ago.

"Actual hotel revenue fell well short of the original revenue projections. Since opening in mid-2007 and up until March 31 this year the property achieved an overall cash-negative result before the payment of any returns," McKenna said.

Bruce Whillans, one of New Zealand's top commercial real estate agents, paid tribute to McKenna and his Westin property which he said was an asset to Auckland and its tourism sector.

"The Westin is beautiful and he's left a real legacy to Auckland, like Andrew [Krukziener] with Metropolis. The biggest problem for New Zealand now is a dearth of developers. In Australia, they have many listed businesses like Brookfield Multiplex, Walker Corporation and Mirvac.

"Here, most property development is done by the private sector and I don't know who's going to pick up the ball without these sorts of people. It's a real problem," said Whillans.

HEARTBREAK HOTEL

THE WESTIN, AUCKLAND
* 21 Viaduct Harbour Avenue.
* Developer/owner Nigel McKenna owns 16 suites.
* Smoke-free hotel opened 2007.
* Part of $300m Lighter Quay project.
* Voted as one of world's top 100 hotels.
* Fully booked for Rugby World Cup.

THE CREDITORS

Creditors of lighter quay hotel management (in receivership) include
* Melview Viaduct Harbour (in receivership): owed $1,281,629.94
* GDF-1 LLP, Britain: $194,956.58
* Lighter Quay Residents Society: $188,975.89
* Landplus Holdings: $113,099.32
* Cheah Min Loong and Cheah Soo Ling: $90,818.03
* Phang Tze Vui and Chua Peng Teck: $74,611.02
* Tan Gaik Leong and Ooi Kim Lan: $64,617.51
* Chew Soo Cheng and Chew Wing Hwa: $60,243.70

Source: Part of schedule of 122 creditors, failed creditors' compromise deal managed by Jeff Meltzer & Lloyd Hayward