The plan is for Wellington City Council to buy the land underneath Reading Cinema for $32 million based on a recent valuation.
Reading will then lease the land back from the council on a 21-year perpetually renewable lease.
The annual rent paid by Reading will cover the council’s costs, including that of borrowing, so that it is fiscally neutral to ratepayers.
Reading has the first right to buy back the land at any time within the first 15 years of the lease.
During the first ten years, Reading can buy the land back for the council’s original purchase price of $32m.
The council can sell the land to someone else at any time after the first 10 years of the lease.
The deal includes a provision allowing the council to only complete the agreement and pay the balance of funds to Reading once it is satisfied the new building design meets desired civic outcomes and has resource consent.
Whanau said it was an extremely good solution.
“Quite frankly, if we shoot this down I don’t see any reason why officers would try and find creative solutions in the future for the problems we face.
“I’ve heard over and over again from Wellingtonians that they want something done about it and are frustrated by the lack of action. This deal seeks to deliver that.
“It will see many tens of millions of dollars invested by Reading into a dynamic redeveloped centre featuring a state-of-the-art cinema, with a variety of dining and entertainment options. A venue that attracts people to the city, is family-friendly and will contribute to a vibrant Wellington.”
Whanau has released the details ahead of a meeting tomorrow where a notice of motion by Councillor Iona Pannett to revoke decisions the council has made on the cinema is due to be discussed.
No information about the motion has been provided in the agenda and council officials had recommended it be considered in a public-excluded part of the meeting
But not a single councillor the Herald has spoken to completely agreed it should be discussed in secret, easily giving Pannett the majority she needs for a vote to have it play out in public.
Councillors and the Mayor, whether they support the actual deal or not, have become increasingly aware of the public suspicion and aggravation that the secrecy around it has caused.
As recently as Monday, Whanau told Newstalk ZB Wellington Mornings host Nick Mills she could not discuss the details of the deal yet.
“We have to vote for it to go public on Thursday so, I can’t talk about it”, she said.
Whanau said the details could now be made public after reaching an agreement with Reading Cinemas on releasing key aspects of the proposed deal to the public.
She acknowledged the significant public interest and noted 80 per cent of the deal has now been agreed.
Council documents, seen by the Herald, said this was a unique opportunity to revitalise the Courtenay Pl precinct and does not set a precedent.
In an email to all councillors, council chief executive Barbara McKerrow said she was no longer recommending tomorrow’s meeting take place behind closed doors given details of the deal were now public.
Georgina Campbell is a Wellington-based reporter who has a particular interest in local government, transport, and seismic issues. She joined the Herald in 2019 after working as a broadcast journalist.
