Six years' limbo for villa investor

Developers of Fiji Beach Resort and Spa went into receivership in 2009. Photo / Supplied

An Auckland man says he has been left in limbo for six years over his investment in the yet-to-be completed Hilton resort on Fiji's Denarau Island.

Kevin Rowe is one of about 240 mostly New Zealand and Australian investors who put their money into Kiwi developer Neville Mahon's plush project.

The Fiji Beach Resort and Spa, managed by Hilton, attracted some high-profile investors including former All Blacks Andy Haden and Ian Jones, and former Fisher and Paykel CEO John Bongard.

Stage one of the resort with 160 rooms was built, but stages two and three, with 90 rooms, have never been finished.

Rowe put down a $50,000 deposit on a stage-two villa in 2005. Six years later not a sod has been turned on his investment and he is still waiting for the outcome of ongoing efforts to sell the resort.

Mahon's development company, Denarau International, and its associated construction company, Denarau Investments, were placed in receivership in September 2009, with Bank of Scotland and failed finance company Strategic Finance owed a combined $120 million.

Since then, owners of existing villas have battled to receive rental income owed to them. Auckland owner Sarah Hunter said payments had been "sporadic" in recent months.

Part of the issue has been a discrepancy between the agreement owners have with Denarau International and the agreement Denarau has with Hilton. The former is a 50/50 revenue split, owners say, but the latter is based on a profit share.

Receiver Grant Graham of KordaMentha has been talking about a sale of the development for months. Last month he told the Herald on Sunday: "It'll get there."

But Rowe says a sale will not help him. His deposit, now worth about $60,000 including interest, remains in a solicitor's trust account, and if the resort is sold it will be up to the new owner to decide what to do with the development.

"[Mahon] was adamant we would be able to get out of the contract. He undertook we would get our money back by end of 2009 at the latest." But nothing was put in writing.