KEY POINTS:
Urgent notices are being issued to investors who bought properties from real estate businesses associated with Blue Chip, telling them to terminate their lease deals.
Nick Wevers and Tony Woodworth, of First Street Property Management, are telling landlords to act quickly and warning them they might lose their
rent.
Many of the Blue Chip-associated companies are in liquidation, Wevers and Woodworth say.
On January 23, Neil Bell, chief executive of Diem Ltd - Blue Chip's master franchisee in New Zealand - announced First Street had taken over all short-stay properties and Harcourts had taken the long-stay rentals.
Jeff Meltzer, liquidator of 19 companies, including Bribanc Property Group, said that property management could not be handled by his firm.
Wevers and Woodworth said yesterday rent still being paid to Blue Chip-related companies could be seized by the liquidators.
Some of the money First Street had already collected in the last few weeks since taking over the business on December 15 could well be claimed by liquidators, they said.
Woodworth said First Street could not pay landlords directly until leases had been officially terminated and all ties cut with entities associated with Blue Chip.
"Protect any income from today forward by drawing a line in the sand. The only way to do that is to terminate the lease," Woodworth said.
Wevers and Woodworth issued an urgent memo to investors telling them the sooner they terminate their leases, the less money they stood to lose.
"If we are managing your apartment, we can make sure that any rent being collected from the date of termination will be held in trust for your account and not the liquidator," they wrote to clients.
Wevers was a Blue Chip chief executive and Woodworth was the general manager of its management arm, Bribanc. They left in 2004 and 2006 respectively.
First Street is managing more than 200 apartments owned by Blue Chip investors. Most are short-stay units in Auckland.
This month, 19 companies associated with Blue Chip's New Zealand franchisee went into liquidation, raising fears for about 4000 investors who own about 2000 properties worth more than $850 million.
But many other investors paid deposits on properties not started or completed, leaving them in a less tenable position because they have no physical asset yet.
In a separate development yesterday, the wait to see how much money can be recovered was prolonged.
Liquidators said initial investigations had showed that the 19 companies were so elaborate that it would take much longer than initially expected to sort out the businesses. Meltzer, Arron Heath and Lloyd Hayward have applied to the High Court for extra time to prepare first reports. They expect a decision this week.
