We have the dubious distinction that our commercial property (read it’s sorry tale here) is situated within the precinct pencilled in for the new stadium. We resigned ourselves to the fact that our land would be lost to us, but were buoyed by the stated intention to quickly and fairly manage the land acquisition process…
Their first mistake!
We dutifully gave CCDU all the required information about our property within the week of the announcement of the blueprint. And then we waited. And waited.
How do businesses manage with this kind of uncertainty? [Answer: see yesterday’s post on “regime uncertainty.”]
It’s taken three months and this week we received notification that the Crown has obtained a valuation on our land and that valuation would mark the starting point for a negotiation about land purchase.
The valuation was orders of magnitude below what they expected. Naturally, the forced “sellers” want at least as much as they would have to to spend to get a replacement piece of land anywhere similar. Whereas the confiscator (the government) wants to spend as little as possible. And in a flattened central city with less business activity than downtown Ekatahuna, they’re keen to pick up land to carry out their grand plan for as little as possible—and trying to do it for as little as possible by confiscating land
for nowt with made-up valuations.
Under the Public Works Act, an owner could at least challenge the valuation on which the government based its pay-out for your confiscated land. But not on Czar Gerry’s watch you can’t:
Here’s where it gets interesting. The Crown contracted valuers Colliers and Telfer Young to perform all the valuations. As would be expected, we requested from CCDU’s agent a copy of the valuation. Strangely we were told that:
Unfortunately we are not allowed to hand out the Crown valuations. The reasoning behind this is that
we have made an offer at market value (based on the Crown’s valuation) and it is up to the property
owners to provide evidence contrary to that of the crown if they disagree.
This is highly unusual – in usual negotiations, be they rental or buy and sell ones, both parties have access to valuations and hence negotiations can happen in an open and transparent manner. In this case that is not the process and the Crown, despite its stated intention to act fairly, honorably and flexibly with landowners, would seem to be taking the role of commercially-driven land banker, while at the same time sheltering under the protection of an unprecedented piece of legislation which puts all the power in their hands.
Calling them “commercially-driven land bankers” is far, far, far too kind—unless Mr Benes means it as some kind of complex rhyming slang.
And yes, it is highly unusual. The last time land was nationalised in New Zealand on the scale now being carried out in Christchurch, it took over one-hundred and fifty years for settlement to be reached.
People are shaking in fear at the power that CCDU and CERA are wielding in this city. What we have here then is a situation where the crown is demonstrably acting in a prejudicial manner that is designed to minimize the amount they have to pay for land. In other words, the Crown is using subterfuge to duplicitously rob land owners of fair value for their land, and in doing so, is furthering its intention to make an economic windfall from the future sale of acquired land.
Yes, that’s the other strong rumour around town…
… that the Crown is intending to acquire land… at an artificially deflated price and to later sell that land at inflated prices.
It’s not like it’s unprecedented for a NZ government to do this. That is, after all, how New Zealand was settled.
Alas, yet again, it would seem that something is rotten in the state of Christchurch.
He just said a mouthful.
But given the source of that rot, supporters of the National Party’s “nationalise everything” earthquake policy should look closer to home.