A second Auckland RSA in a matter of weeks faces the prospect of losing their clubrooms after the cash-strapped organisation last week sold their prime land to a Malaysian developer for between $4-6 million.
The altered sale - from an original proposal for a joint clubroom/apartment complex - has been justified by the RSA president Ray Sangster as a necessity for a club that was allegedly bleeding $7000 a month on upkeep expenses.
But some members are irate - with one committee member making a police complaint alleging “fraud” in the sale.
The official sale on October 20 comes just a week after the Herald reported a deal to sell the Point Chevalier RSA to supermarket chain Foodstuffs for about $10m had been downscaled to no longer include new clubrooms for veterans and members - upsetting many in the process.
The original proposal to sell the 3497-square metre plot of land on 25 Wellington Street, Howick to developers was supported by Howick RSA members in 2021. The land was council evaluated at $6m 2021.
Sangster said this joint venture was for a five-level apartment complex with new RSA clubrooms and retail outlets on the ground floor.
“Where we ran aground with the redevelopment with a joint venture partner was we didn’t realise, we didn’t know at the time, but there’s a special character clause in certain parts of Howick to attain that colonial attitude… that was going to exceed the height restriction that was imposed on where we are located,” Sangster said.
“So we had to go back to the drawing board and and cut off the top level and and part of the third level. That was all just pre-Covid, and then Covid hit and the building restrictions and building supply and costings kind of ballooned, and it kind of made the the project - well, [we would have been] lucky to have broken even.”
Sangster also said the existing 1976-1615sq m RSA building needed substantial earthquake strengthening, a new roof and adaptation to new floodplain regulations that represented “a mass of expenses”.
As a result of all this, Howick RSA members voted to sell the land to developers outright - with no provision for new clubrooms as part of the new complex - in February. Sangster said the members’ vote on the land sale was 110 for, 12 against and two abstaining.
Sangster said the February meeting was “correcting the wording in the original decision to sell the building - that’s what we achieved [through] that latest vote we took. We put toward the members and we laid out the financials and said, ‘Look, this building is costing us $7000 a month to just keep sort of viable; to keep the building warrant of fitness up to speed. And when you’ve got minimal cash flow, $7000 a month is quite a lot of money.”
“We just had to stop the money bleeding.”
Since May this year, Howick RSA members have temporarily been gathering at the Prospect of Howick pub on Picton Street, where the RSA’s Eternal Flame was transferred.
Sangster maintained that it was “very clearly stated in the trust deed that any funds [from the land sale] remaining after any debts paid must go to the re-establish of the Howick RSA”.
Yet it is not clear if this re-establishment would constitute a new hospitality facility - hence, new clubrooms.
“We’re going through a transition period from closing this one down and then moving forward to the next option. We’ve got to consider all the possibilities, even to the point where [we ask]: can we justify having another hospitality option?” Sangster said.
“That decision still really has to be confirmed. So we’re just looking at the options now. There is a commitment to try to do it, but that will come down to numbers [and the] viability of opening another hospitality [business] in Howick, given the hospitality options already available in Howick.”
Sangster confirmed the RSA would be signing over the land to Malaysian developers on Friday afternoon.
He said the sale was more than $4m, but that the council rateable value of $6m “doesn’t necessarily mean that’s what the property is worth”.
“It’s kind of worth whatever somebody will pay for it. We’ve put it out to tender, and none of the tenders were that much [$6m]. We had some very qualified people look at the whole deal, and they wouldn’t have accepted it without qualified advice.”
However, Howick RSA committee member Margaret Hawkeswood said “members are devastated that their clubrooms have been sold”.
“The charity is bleeding equity to consultants, lawyers and land agents,” Hawkeswood said.
Hawkeswood made a complaint to police this week about the process of the members’ vote in February to agree to sell the Wellington Street land to the Malaysian developers.
“The issue I have is the timing of the [February members’ meeting], and gaining permission from a majority vote from members to sell the property. The presenters were aggressive. Alternative funding proposal was ruled out [as] ‘too late’, [and because] the decision to sell the property had been made ‘ages ago’ by the trustees. Fait accomplait,” Hawkeswood said.
Hawkeswood alleged fraud was engaged in at the meeting because insufficient warning was provided to members to attend and no other funding options to keep the clubrooms were offered.
“A harsh and dire presentation was given. The Property Trust presenters were aggressive and shouted down my proposal for an alternate funding proposal rather than the selling of the property,” Hawkeswood claimed.
“Attached to the written motion was a threatening statement to the members: ‘Consequences Should You Choose to Vote NO’.”
Sangster confirmed there were roughly 700 Howick RSA members.
Despite the uncertainty about the future of a clubrooms and hospitality element, Sangster assured the Howick RSA would still be providing support for local veterans.
“The Howick RSA will not die in Howick. We’re committed to [restablishing] it. We’ve got the funds to restablish it. We’re just working our way through a process, and we’ve relocated our welfare operations that we’re still continuing with.”
In August, the Herald reported the national RSA office was now urging clubs to consider how closely their actions aligned with the ethos of the Royal New Zealand Returned and Services’ Association as it was set up 107 years ago.
It was a measure being taken by the national office through a “warrant of fitness” study of the accounts and membership of the independent local clubs across the country.
Former two-star general Martyn Dunne is now chairman of the board and - along with patron Sir Wayne “Buck” Shelford - wants the RSA to be less about cheap booze and food and more about supporting those who served New Zealand.
Dunne said the club-by-club check had the national RSA body studying financial accounts posted by local clubs to the publicly-accessible Incorporated Societies Register.
Wayne Morris at the Pt Chevalier RSA bristled at the prospect of the national body issuing instructions to the independent local clubs.
“To be honest, Wellington is probably looking for our money. As far as I’m concerned, they can get stuffed until it has been put to members.”
Morris said it was understood the RSA existed to support veterans. He said of its 380 members, about 15-20 were veterans, who were “rarely” seen because of their age. “Because they can’t get to the club.”
Tom Dillane is an Auckland-based journalist covering local government and crime as well as sports investigations. He joined the Herald in 2018 and is deputy head of news.
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