A $120,000/year fee for the swimming pool, gym and cinema beneath Auckland’s The CAB apartments on Aotea Square has resulted in a group of residents suing the developer of the ex-Auckland Council headquarters.
John Love, managing director of Love & Co, which converted the 18-level heritage office block into apartments, said the dispute was over fees for the swimming pool, gym and cinema.
The owners’ case was without merit, he said, although apartment owners who contacted the Herald said they never envisaged such heavy annual fees in their body corporate charges.
“This is an unfortunate situation where a minority of unit holders have misunderstood aspects of their agreements and body corporate administration, and have then brought court proceedings,” Love said of The CAB case.
The High Court at Auckland is due to hear the case on October 20.
The residents are seeking a summary judgment against Love’s Civic Lane.
“I am not able to say much more while that court process is ongoing,” Love said.
Instead, those facilities were always intended to form part of the overall and much larger planned Civic Quarter development, which is yet to be completed, he stressed.
“All unit holders have the ability to access and use those amenities. There is a licensing fee arrangement in place with the relevant body corporate to pay the costs of those amenities and ensure they remain available,” Love said.
That fee has not increased, as some owners claimed, he said.
Instead, there was initially a stepped abatement period for the first two years, going from zero to $60,000.
Therefore the fee had gradually increased to the “business as usual” amount over time, Love said.
“I do not accept any of the other allegations made by the minority group, but the proper time to address them will be in open court,” he said.
Two other buildings are planned to be built within that civic quarter.
When those are up, the fee for amenities in the basement of The CAB will be split between three buildings.
“The fee was established by an independent third-party valuer,” Love said.
In the first year, no fee was charged.
In the second year, the fee was $60,000.
In the third year, it was $120,000.
Payment of the full $120,000 is now being sought from only CAB owners, who told the Herald they never envisaged paying that much annually.
Love acknowledged that the full cost was falling on the owners of only one block, not the wider and much larger development as was initially envisaged.
“Currently The CAB residents and their guests are the only users in the Civic Quarter development,” he acknowledged.
One owner said the fees doubled from 2023 to 2024.
Although they can use the amenities, the very high charges mean they question why this is being passed on to them.
Some were asked to contribute to a fighting fund to engage a barrister.
A number of CAB apartments remain unsold, including the penthouse and two sub-penthouses.
Love’s Civic Lane and one of New Zealand’s biggest builders were fined $35,000 for illegal modifications to the top level.
The decision from Judge Sheena Tepania in the Auckland District Court fined Civic Lane $21,000 and builder Naylor Love $14,000 for modifications that were found to be illegal.
Both companies pleaded guilty to a charge of using land in a manner that contravenes a district rule under the Resource Management Act for modifying the top-floor open deck on level 18 of the former council-owned Civic Administration Building (The CAB).
Love is the sole director of Civic Lane, which contracted Naylor Love to work on the building in what is New Zealand’s largest office-to-apartment conversion.
That was a $150 million project.
Love’s deal with Eke Panuku means he has not yet paid the council entity $3m for the building because he is yet to repay a debt on the project to an Australian funder.
Anne Gibson has been the Herald‘s property editor for 25 years, written books and covered property extensively here and overseas.