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Debts are rising daily for many investors who bought finished properties from entities associated with Blue Chip as rates, electricity and body corporate fees mount.
Investors had expected that property management entities of Blue Chip's New Zealand franchisee were paying their bills out of the rent.
Instead, many landlords have discovered that these fees have gone unpaid for some time, along with rent which stopped flowing late last year.
This week, 19 companies went into liquidation, including Bribanc Property Group. More than 4000 investors bought about 2000 properties from various Blue Chip entities and many got rent from Bribanc.
Investors hoped to make fast money for retirement from the booming real estate market. Instead, they have been caught up in one of the country's largest corporate liquidation sagas and are awaiting the first report from liquidator Jeff Meltzer.
Andrea Clough and her husband Dennis bought two Auckland apartments. She said they had big bills mounting daily on their units.
Already financially stretched due to being owed thousands in rent, the Tauranga couple had to pay an outstanding rates bill of $1084.74 on their Gulf Harbour unit. But annual body corporate fees of $2774.26 and a special levy of $4622.63 are still outstanding and the couple are worried about how they can afford the $7396 owing. Those bills were supposed to be taken care of by Bribanc, the property manager, Clough said.
She said this had come as a further blow.
Greta Norman of Epsom also copped bills on her luxury Quay Park unit, discovering late last year after her rent stopped coming in that neither Auckland Regional Council nor Auckland City Council rates demands had been paid. She complained and got some money but is owed more.
Olly Newland, who is assisting a group of investors, said the string of liquidations affected investors who had arrears of rent, rates and levies on existing properties. "Those who have paid deposits for property not yet completed [or non-existent] still retain a right of action for refunds," he told investors.
He said he wanted to reassure people. "I realise that this is a stressful time for you. I can only say that my team and I are doing our best for you and your case. Be brave and stay strong. In the end justice will prevail," he said.
Meanwhile, Blue Chip Financial Solutions' future on the Australian Stock exchange remained in doubt yesterday with no new announcements. On Thursday the company was suspended from the ASX at its own request.
