Property editor of the NZ Herald

Property boys on their way back

File photo / Paul Estcourt
File photo / Paul Estcourt

Failed property developers will soon return to the sector, says the receiver left to recover $369 million from three big Auckland and Queenstown projects.

Tim Downes, a partner at accountants Grant Thornton New Zealand, said a few developers were unlikely to get support from banks but others would certainly be back.

He was receiver on Layne Kells' Soho Ponsonby project with $95 million owing to secured creditors, Jamie Peters' Gulf Harbour where $156 million was owed, and stages two and three of Nigel McKenna's Kawarau Falls at Queenstown where $118 million was owed.

Downes said that now many of his big property receivership assignments were either completed or in their final wash-up phase, he could see signs of life in the property development scene but he was reluctant to single out any one developer.

"The current climate provides a good opportunity for a new wave of developers and some of those who have been involved in failed projects in the past may still get bank support if the project is right.

"From my experience, even if a particular property investor/developer has cost a bank money in the past, the same bank may still look favourably on them, depending on how they handled the situation."

Downes pointed to the severe housing shortage, particularly in Auckland, and said the fact that banks were "awash with cash" pointed to the dawn of a new era.

- NZ Herald

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