Quay Park rent reviews under way early

Ngati Whatua is working on a precinct-wide plan for Quay Park to try to improve it.

Wealthy Auckland downtown waterfront landowner Ngati Whatua has already begun the 2018 rent review negotiations with tenants on 20ha of leasehold land.

A bruising first round of rent reviews concluded only recently and went to arbitration before retired High Court judge Robert Fisher QC, as apartment owners fought to keep the leasehold fees down.

Rob Hutchison, chief executive of the commercial arm of Auckland iwi, Ngati Whatua Whai Rawa, said talks on 29 leases due to be renewed from August 2018 had already started at both sides' behest.

"I've already started talking to the lessees for the 2018 review. It was expensive for the lessors and the lessee and we're now talking to a number of lessees about how we can make this a better, smoother, less costly process the next time around. We've been through it once and it will be a lot easier next time," Hutchison said. Improvements were suggested by both parties.

"Feedback from the lessees is they want to engage early and on a face-to-face basis, without lawyers so it's a closer relationship. There are 29 leases but Scene One and Scene Two are one and Scene Three is a separate one," Hutchison said.

Ngati Whatua's latest annual report declared $18.5 million "lease of investment property" in the June 30, 2014 accounts and showed it took three years after the August 2011 rent review date to settle the new, contentious ground rent payments.

"The first rent review date for the 29 commercial ground leases was August 2, 2011," the annual report said. "The arbitration proceeding relating to the final two properties concluded in June 2014."

Ngati Whatua bought the Quay Park land 19 years ago but could charge no ground rent for the first 15 years, until 2011, sending shockwaves across the area because the leasehold is set at 6 per cent of the unimproved land value.

Some ground renters decried big new leasehold land bills charged up to $8000/unit and more.

First to settle in that first round were commercial tenants GE and BNZ. Last to settle were owners of Scene One and Scene Two apartments.

In 2012, owners of five big apartment complexes fought the iwi: Parnell Terraces, owners of buildings on Cotesmore Way, Dovedale Place, Sudbury Terrace and high-rise The Mirage at 86-88 The Strand off Quay St. In a separate move, Hutchison said Ngati Whatua was working on a precinct-wide plan for the area to try to improve it. "We're spending a lot of time and effort developing a precinct plan for the next 20 or 30 years, making it more pedestrian-friendly, engaging with Auckland Council across all of Quay Park about what we can do."

Accounts list the iwi as owning land valued at $588 million, which includes Whai Rawa Railways' $289.2 million. That land was valued in 2013 at $269 million.

Quay Park land

• 1996: Ngati Whatua bought 20ha ex-railway land bounded by The Strand, Quay St and Beach Rd from Crown.
• Buildings on 150-year ground leases, with initial 15-year rent holidays.
• Corporate offices for BNZ and GE Finance.
• Vector Arena
• Countdown
• Quay St shops
• Scene One, Two and Three apartments
• Hudson Brown apartments
• Grand Central apartments
• The Landings Parnell
• Quay Park Health
• Parnell Terraces
• Townhouses in Cotesmore Way, Sudbury Tce and Dovedale Place
• Quba Apartments
• Waldorf Stadium Apartments
• Aecom House.