Westin Hotel company in receivership

Auckland's five star Westin Hotel. Photo / Chris McLennan

Receivers have moved in to take control of the company that runs one of Auckland's top hotels, the Westin Lighter Quay.

The five star hotel will remain operating as normal and staff will not be affected. There is no change to any forward bookings.

Receivers KordaMentha have issued a release saying they have been appointed as receivers for Lighter Quay Management - the company which runs the Westin Hotel complex.

It says the receivership is the result of failed talks between Lighter Quay Hotel Management and its creditors, who include room owners who lease hotel rooms to the company.

Receiver Michael Stiassny this morning reassured people that it was intention for the hotel to keep operating.

"Since opening in 2007 to much acclaim, 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 next year.

"We want to reassure investors, the hotel operator, staff, suppliers and guests to the Westin Ligher Quay that it is our intention for the hotel to continue to operate as usual. As such, we will be seeking to meet with both the hotel operator and represtentatives of the hotel room owners as a priority."

A scheme of arrangement originally proposed to the creditors in May and voted on last week was rejected, says KordaMentha, so a secured creditor had appointed receivers to protect its interest.

The $130 million Lighter Quay hotel has apparently been running at a loss since it opened three years ago.

Developer Nigel McKenna proposed a $10 million plan with benefits in the next six years, half to be paid in cash.

See the compromise proposal document here.

McKenna brought the Westin international brand to New Zealand three years ago. The 172-room, $130 million hotel at 21 Viaduct Harbour Ave opened to much acclaim and since then has hosted a string of major events.

The company facing claims of $5.9 million, Lighter Quay Hotel Management, owns facilities such as bars and restaurants and leases suites from investors who paid millions of dollars to get the project off the ground.

The creditors' compromise proposal listed 122 creditors demanding an average about $40,000 each although sums vary widely.

Lighter Quay Hotel Management faces the claims from people who expected good returns from the units in the block.

The biggest creditor is McKenna's own Melview Viaduct Harbour, claiming $1,281,629.94.

British investor GDF-1 LLP is claiming $194,956.68, the Lighter Quay Residents Society is claiming $188,975.89 and Cheah Min Loong and Cheah Soo Liang are claiming $90,818.03.

- NZ HERALD