$5m for half share in 'epitome of all that is NZ'

Pohuenui Nature Resort is 45 minutes by air from Wellington

A half share in one of New Zealand's largest privately owned islands has changed hands for $4.9 million, after one European investor gained Government permission to buy his partner out.

The Overseas Investment Office granted permission for the deal between the Luxembourg pair to sell a half stake in the 2122ha Pohuenui Island, in the Marlborough Sounds.

Andreas Fellmann, of the Luxembourg-based Garden Bay Resort, will buy the half share from Gunter Thiel.

Although the huge island is connected to the South Island via a narrow peninsula, it is only accessible by air or sea and is a sheep, grain, beef and cattle farm with extensive lodge accommodation developed in the last 13 years.

During the 1920s, it was said to be one of New Zealand's most productive farms.

Only about 520ha of the island's land is used for farming and the rest is "in various stages of re-generating native bush".

Up to 28 guests can be accommodated on the island, which has a five-bedroom homestead, a three-bedroom cottage used as the farm manager's house, a sleepout, self-contained treehouse, backpackers' accommodation, cookhouse with accommodation, woolshed and a two-storey house.

The island last changed hands in 2004 when Montgreenan and Garden Bay Resort received permission to buy 25 per cent of Pohuenui Nature Resort, owned by German company Vladi Private Islands (Pacific). The Germany company bought the property in July 2002.

In September 2002, the Overseas Investment Commission, as it was known then, approved an application for Ingrid Kathman-Broring of Switzerland to sell the island to Europe's Newco, owned by Luxembourg and German interests, for $8.3 million. The island then had a Government valuation of just $1.1 million.

Newco was then owned by Mr Thiel, Mr Fellmann and Farhad Vladi of Germany.

When Bayleys last advertised the island for sale by private treaty four years ago, the agency promoted its 40km of farm tracks, high average rainfall, large historic woolshed, 5ha of radiata pine trees, natural water supply and fences.

The international marketing campaign described the property as "one of the largest privately owned islands in the South Pacific", boasting 50km of coastline, many private bays and secluded beaches, a 100ha native forest reserve managed by the Department of Conservation and "a tremendous range of both native and introduced bird species".

Nigel Mitchell, manager of the Pohuenui Nature Resort, said DoC managed the 80ha Kauauroa Reserve on the island, the 20ha Long Point Reserve and a third much smaller reserve on the Beatrix Bay side of the island.

Up to 20 guests would stay on the island this month for $25 to $120 a night each and the ownership change made no difference to the tourism business, he said.

Bayleys says: "Adjacent to the island are a number of sanctuaries which are home to some of the world's most endangered species of flora and fauna. Pohuenui Island is the epitome of all that is New Zealand, from its peaceful, unspoiled natural beauty to its enviable reputation for efficient pasture production."

It takes 45 minutes to fly via helicopter to the island from Wellington, although most guests arrive via sea from Havelock.