Punters key to survival

Cargo Bar is the most upmarket of the bars. Photo / Jason Dorday

The owner of one of Auckland's top waterfront nightspots is counting on punters to help repay a $1.4 million debt incurred after a major relaunch last year.

A multimillion makeover of the former Loaded Hog site by bar magnate Jonathan Botherway, also known as Barry, ran over budget and behind schedule.

The business, at a prime Viaduct location, will try to trade out of debt over the next two years after creditors, one of which is owed almost $1 million, approved an 11th-hour compromise.

"It was good that the deal was available and the creditors were happy to unanimously support it, and we box on from here," said Botherway, the Christchurch businessman who bought the Loaded Hog in May 2007 for $3.4 million, raising the cash with loans from South Canterbury Finance and New Zealand Breweries Limited.

Last year he divided it into four separate premises - the Cargo Bar and Restaurant, Cargo Lounge, Four Nations Bar, and a fourth which remains unfinished.

The $1.6 million makeover ran $700,000 over budget and finished too late in December to profit from the Christmas rush.

"It wasn't anything any of the contractors did, it was problems with the building and beams that needed strengthening," Botherway said.

Had the bars opened earlier, cashflow from the busy festive period would have covered the extra costs.

Botherway said the recession also took its toll. "If I'd known I probably would have held off and traded through as the Loaded Hog until we got through this blip."

David Howes, managing director of Cape Interiors, which is owed $992,000, said the deal was the "best of a bad situation".

"It's not ideal, but hopefully they can trade out of it.

"The key for everyone concerned is that people go there and he carries on trading. That's the only way forward."

Botherway has set up bars in Auckland, Christchurch and Queenstown. He owns Christchurch's 205 Cocktail Bar and Cellar, named best new bar at last year's New Zealand Bar awards.

He wanted to break the Loaded Hog into four smaller, linked spaces to make the most of the waterfront location. Botherway said the Cargo Bar is more upmarket than the Loaded Hog, while the Four Nations is a "cosier, winter space".

PKF Recovery and Insolvency said the deal was unanimously accepted at a meeting on May 5.

Under the proposal creditors will be paid in two instalments, in March 2010 and March 2011.