Blue Chip investors' apartments up for sale in liquidation

A group of apartments at the Beaumont Quarter site in Beaumont St, opposite Victoria Park, will be sold. Photo / Supplied

A liquidator is preparing to sell a group of Beaumont Quarter apartments owned by Blue Chip investors.

Bernie Montgomerie was appointed liquidator of companies owning seven apartments and five carparks in the high-density estate on Beaumont St opposite Victoria Park.

He has posted reports on the companies showing how much they owed.

The housing estate has eight body corporates and Montgomerie has been appointed by some of these after Blue Chip investors failed to pay ground rent, body corporate fees and water rates.

The apartment owners formed companies to buy the rental properties, many in the hope of providing for their retirement.

But Bribanc, the Blue Chip company collecting their rent, went into liquidation. That was not the only problem - leasehold land fees compounded the situation.

Montgomerie's report on Bernie & Peter Properties (in liquidation) showed how the ground rent for that company's Fisher Point Drive apartment was initially just $3900 annually but the landlord subsequently sought to increase that to $20,000.

Although the directors took over the tenancy management of the place from Bribanc, the rent received was not enough to pay all the fees owed, Montgomerie said.

Body corporate fees, ground rent and the interest on the mortgages raised via National Bank and ASB could not be covered.

The directors tried to fund the shortfall from other properties but had no further capital to inject.

The directors are champion athlete Bernie Portenski and Peter Horan of Wellington. They investigated taking action against the parties involved in them investing in the Beaumont Quarter apartment, Montgomerie said.

But they did not have the funds to take the matter further. The apartment is being rented for $450/week. They bought the apartment in June 2007 for $483,000.

Horan said the rent was eaten up in all the fees at Beaumont Quarter.

"We just left it to the bank. We just walked away from it," he said, adding that not all the loan was secured.

Bernie Portenski had first heard of the Blue Chip scheme through associates who recommended it.

"We had good vibes," Horan said.

They had not seen the apartment before buying it, Horan said. Asked why he had spent $483,000 buying an apartment sight unseen, he said: "Because other people had done it," adding that he had trusted Blue Chip, lawyers Mathias Law and the Blue Chip salesman they dealt with.

He took some share of responsibility for the purchase but said people should be able to rely on those who provided professional services like lawyers.

Montgomerie prepared a list of Beaumont Quarter liquidated companies showing how National Bank had provided loans to most of the businesses.