Property developer offers to buy Reading land, instead of city council

Report from RNZ
A wealthy Wellington property developer and philanthropist has offered to buy the land under the shuttered Reading Cinema complex in downtown Wellington.

The Wellington City Council is today discussing a deal to buy the land from its international owner, who would use the money to do upgrades and earthquake strengthening.

Sir Mark Dunajtschik’s lawyer presented his plan to the council this morning.

Lawyer Nick Wareham said Sir Mark would negotiate directly with Reading to purchase the land and offer it a lease.

“He will make payment to Reading for the land on a progress built completed basis, and he will contribute his funds after Reading have first invested their own money.”

The rental proceeds will ultimately end up in Sir Mark’s foundation, which would then gift the land back to Wellington citizens in 50 years’ time.

If Reading wish to buy back the land prior to this gifting, they can negotiate to do so at market rates.

Wareham said Sir Mark was urging the council not to go through with the current plan, saying “ratepayers are on the raw end of the deal”. He said the council would be risking ratepayers money up front, with no guarantees that the redevelopment project would proceed. It would be putting ratepayers in before Reading did, affecting the amount of leverage the council had, he said.

“The council will simply be covering its costs of funds.

“It is unlikely that this will match a normal commercial ground rental and therefore the citizens of Wellington will not only be subsidising a commercial entity, they will also be foregoing a normal commercial return on land.

He said the deal could reduce the council’s borrowing capacity.

Sir Mark and partner Dorothy Spotswood donated more than $53 million to build the Wellington Children’s Hospital, and have pledged another $50m to build a Mental Health Hospital in Lower Hutt.