Mortgagee sale over $7m loan

A prime 1615sq m vacant plot on Wellington's Waterloo Quay is being marketed as a mortgagee sale.

Finance company tries to claw back some of the money lent to Tony Gapes' company 13 months ago

An Auckland-based developer behind multi-million dollar projects has had a property owned by one of his companies put up for mortgagee sale by a company he borrowed money from.

Tony Gapes is still building several multi-million dollar projects through various companies around New Zealand.

Those include Springpark, billed as New Zealand's biggest residential development with 424 apartments or townhouses, and The Square, an Arch Hill development that includes 80 apartments, retail shops, a preschool, gym and a boutique cinema.

He is also building the $125 million Five Mile shopping centre in Queenstown.

Money lender ASAP Finance has put a 1615sq m prime plot on Wellington's Waterloo Quay up for mortgagee sale today as it tries to claw back some of the $6.99 million it lent to Waterloo Quay Projects Ltd - of which the Companies Office shows Gapes as the sole director and shareholder.

A Quotable Value document obtained by the Herald shows Gapes' company took out a $6.99 million mortgage with ASAP Finance on December 21, 2012.

The site - which has a valuation of $4.9 million but was bought for $5.6 million in November 2011 - is next to the Wellington Railway Station and has resource consent for commercial office or residential use.

It is currently operating as a carpark, with a 10-year lease to Wilson Parking New Zealand Ltd from August 2011.

But the lease has a break clause if redevelopment takes place on more than 50 per cent of the property.

Bayleys real estate agent Fraser Press said much development had taken place within 500m of the site, including premises for BNZ, IRD and NZ Customs.

"The forced sale circumstances only serve to add to the appeal for the office development market which is coming back with a hiss and a roar in the capital."

The notoriously media-shy Gapes did not return messages left with his development company, Redwood Group.

ASAP Finance director Darpan Patel said he did not want to comment.

"Obviously we can't really comment on something like this, it's not that we don't want to ... it's obviously not ethical to comment on something that's ongoing."

Gapes has been involved in several large-scale development projects in the capital and through his company Redwood Group.

Gapes has faced leaky building controversy in the past. His $12 million 65-unit Silverfield Terraces site in St Lukes were found to be leaking 16 months after it was built, and his 97-apartment Eden Two site in Mt Eden suffered leaks and rotting balconies.

This story has been changed from an earlier version which incorrectly said Tony Gapes developed the Sylvia Park shopping centre. That was developed and is owned by Kiwi Income Property Trust.