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Christchurch-based property developer David Henderson's Property Ventures Ltd - which is partly funded by Hanover Finance and Dominion Finance - is facing court action related to $1.5 million it is said to owe to a crane company.
A spokesman for Smith Crane and Construction, the South Island's largest
crane company, yesterday confirmed his firm was taking court action against Property Ventures over work done at the $2 billion Five Mile development near Queenstown.
"There is a sum of money owed. It's been going on for a long time and we're trying to bring it to a conclusion. We'll all have a better idea of what's happening on Friday."
He said the sum involved was "slightly less" than $1.5 million and having Property Ventures wound up was "one of the options" Smith Crane and Construction was pursuing.
The firm's efforts to recover its money were hampered this week when a public notice pursuant to its court action, which was to have appeared in Christchurch newspaper The Press, was pulled on the instructions of a mystery caller to the newspaper.
"They did not act with our knowledge or authority," the company's spokesman said. The Five Mile development is high-density housing for up to 10,000 at Frankton just outside of Queenstown. It is scheduled to take 15 years to complete and its value was put at $2 billion to $3 billion this year.
Property Ventures, which has a string of residential and commercial property development projects around the South Island, has previously been reported to have financial backing from Hanover and Dominion.
Yesterday, Hanover Finance chairman Greg Muir refused to give any details of his firm's exposure to Property Ventures, but a spokesman for Dominion confirmed the company had "exposure" to Henderson's group.
"They do not have the largest exposure," he said.
Property Ventures, which is majority owned by Henderson through Atlas Securities, had total assets of $263 million as at March last year, which was the most recent set of accounts available. That included total liabilities of $197 million, of which $147 million of borrowings were due to be repaid within 12 months. Property Ventures accounts are due to be filed with the Companies Office shortly.
This month Henderson acknowledged current conditions for his business were "challenging" but downplayed reports of layoffs at Property Ventures and a flurry of sales.
He was not available for comment last night.