KEY POINTS:
The financial future of thousands who have made property investments through Blue Chip-related companies is up in the air, as at least 18 of the companies go into liquidation.
Auckland insolvency expert Jeff Meltzer said yesterday that he had been appointed to more companies associated with the Blue Chip property investment franchise.
He was already liquidator of three Blue Chip property management and rent collection companies.
Neither New Zealand franchisee Diem Ltd nor Blue Chip Financial Solutions Ltd, its Australian-listed parent company, had gone into liquidation.
The liquidations superseded any statutory demands investors had filed against the companies, working with barrister Paul Dale and property investment adviser Olly Newland.
Many of the companies took deposits from investors for Auckland inner-city high-rise apartment blocks.
But in some cases, the buildings never rose out of the ground, and interest payments on the deposits ceased weeks ago.
Mr Meltzer said the liquidation task was huge.
He has formed a team of liquidators to take charge of the entire business in New Zealand.
RENT ARREARS, BUILDING DELAYS AND CONFUSION
Richard Breen, a software consultant of West Auckland, invested $285,000 through a Blue Chip-related business, buying an Albany townhouse.
Now he is extremely concerned about the future of his investment.
Mr Breen first heard of Blue Chip in 2003, and a year later bought a new three-bedroom townhouse at The Avenue. But major weathertightness and building issues arose with the 48-unit complex suffering serious defects. The Avenue was one of the most significant cases of code compliance certificate refusal from the Department of Building and Housing.
Mr Breen was just coming to terms with the prospect of a big repair bill at his townhouse when his rent payments suddenly stopped.
He is now owed $2500 in rent but says more is outstanding because the electricity and rates bills on The Avenue have also gone unpaid. "I feel like I've been ... mistreated ... as do many other investors."
Like a number of investors, Garry Houlahan and his wife Bev of Mt Maunganui haven't been paid any rent on their two-bedroom apartment in the Ascent development on Auckland's Nelson St for more than two months. They've been told they'll get paid on the 18th of this month.
Mr Houlahan said they "didn't have a very nice Christmas" when they received a letter saying body corporate levies on the apartment were in arrears. The Houlahans joined the Blue Chip scheme two years ago because family members had invested.
Christine Knight of Wanganui and her husband invested $450,000 in two apartments in the Washington and Ascent developments, which are managed by Blue Chip-related company Bribanc. They are currently owed about $5000 in rent.
Mrs Knight said she had been trying in vain to terminate their contract, phoning 23 times one particular day. "Making contact with anyone in that office is like trying to get a date with the Queen.
"It's just a big, giant mess. It's the isolation thing, too - we're not in Auckland. It was pure fluke that we stumbled across your articles," she told the Herald.
Wellington man Sudhir Motwani signed a contract for a $500,000 property in a Gulf Harbour development in mid-2004 and paid a $113,000 deposit.
The property has never been built. He was told there were problems with the developer. "It was always around the corner that a fix was going to be available."
He received regular fortnightly interest payments on his deposit until late last year, but hasn't had any since before Christmas.
Mr Motwani is not hopeful of getting his deposit back. "In my mind, at least, I've written it off."
The outcome for one Auckland woman, who did not want to be named, may give investors hope.
She borrowed $465,000 against her house to invest through a Blue Chip-related entity and - like other investors - had problems with rent arrears and contacting the company. But last month she set up a meeting, on the pretext of wanting a 10-year contract, and attended with her lawyer. The Blue Chip-related company signed the property over to her, and she now has it tenanted via a property management company.
