Problems repairing a lower level of Auckland's Metropolis hotel/apartment tower torpedoed an attempt to sell the area and give the proceeds to ill-fated investors owed $30 million-plus.
Glenn Clark, managing director of Trustees Executors - charged with looking after bondholders' interests - has written to the mainly elderly Metropolis investors telling of problems repairing level eight of the tower adjacent to its indoor swimming pool.
Multiplex, which built Metropolis, had to repair unfinished work in the area, he said. Then the space could be let to a business such as a health spa or medical centre.
But the buyer pulled out when work was not finished on time, said Clark.
This is the latest blow for investors who sank $21 million into funding the tower developed by Andrew Krukziener. The investors are due $31 million - their original $21 million plus interest.
Clark wrote to investors telling of the latest problems and projecting a payout of just 43c to 48c for every $1 invested in the development.
Two years ago, Pacific Properties (Metropolis) and Courthouse Capital went into receivership.
Clark said receivers Grant Graham and Michael Stiassny, of Ferrier Hodgson, had a deal to sell the level eight area "at what was considered to be a satisfactory price".
"The condition related to the fixing of certain unfinished building matters and the remedial work was being carried out by the Metropolis' construction company under its construction guarantee and at no cost to the receivers.
"Unfortunately, this work was not completed in time and as a result the sale contract was cancelled by the purchaser," he wrote.
Multiplex is still on the job and, once it has finished, the receivers will again try to sell the area.
Clark has also told investors to forget suing anyone for the missing money.
Legal advice had indicated it would be pointless to take action against those involved in the problems, he wrote.
"The funds we hold could be distributed to bondholders and we are unwilling to spend them on costly legal actions unless we have formed the view that there is a strong chance they will succeed."
Down the drain
* Metropolis bondholders will get less than half the $21 million they invested in 1998.
* Prospects of suing parties involved with the disappearing cash have been ditched.
* Problems with building repairs on level eight destroyed the receivers' deal to sell part of that area.
* Receivers will try for a new contract after building and repair work is finished.
More investor woes hit Metropolis
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