Allied Farmers says it has struck a conditional deal to sell the 23.4 hectare second stage of Queenstown's Five Mile development.
(UpdateS add detail on bank debt, Five Mile book value)
In a statement, that doesn't disclose the buyer's name, price agreed or conditions around the deal going ahead, Allied Farmers managing director Rob Alloway said the timing of the agreement was good given it was near the June 30 end of the firm's financial year and coincided with the negotiation of Allied Farmers' banking arrangements for the 2010-11 financial year. Alloway did say, however, the sale price achieved was in excess of the NZ$23.2 million value attributed to the property in Allied Farmers' half year accounts.
The conditions on the deal don't include any financial ones.
Alloway told interest.co.nz last month a recent valuation of Five Mile showed it was worth about 30% more then than it was late last year. The increased Five Mile valuation was based on recent zoning work which was beginning to crystalise what the site could be used for. He said the site should be able to be used for commercial, medium density, residential and commercial yard space purposes. See story.
Allied Farmers had NZ$50.3 million worth of bank borrowings as of December 31 including a NZ$19.5 million loan from Westpac classed as current, meaning it's due for repayment within 12 months. It has a further NZ$30.8 million of bank borrowings secured over property interests acquired last December from Hanover Finance and sister company United Finance. As of December 31 this debt was also classified as current.
Read Allied Farmers' full statement below:
Allied Farmers Limited today announced that it has entered into a conditional agreement for the sale of the second stage of the well known “Five Mile” property in Queenstown.
The site comprises 23.4 hectares of bare land situated on the gateway into Queenstown. Adjacent to the airport and industrial park, it is thought to be suitable for future commercial and residential development.
Allied Farmers Managing Director, Rob Alloway said today: “We have been working with a number of interested parties for some time and are pleased to have an agreement secured on terms and conditions which meet our expectations. We always knew this site had strong strategic value, and the sale price achieved, which is in excess of the value attributed to the property in the half year accounts, reflects that”.
“Whilst conditional, we are pleased with the timing of this sale, as it is near our financial year end and coincides with the negotiation of our banking arrangements for the next financial year” said Alloway.
The Five Mile property was once owned by Christchurch identity, David Henderson, who through the entity Five Mile Holdings Limited, unveiled plans to build a boutique town centre and residential development on the site. Five Mile Holdings Limited was placed into receivership by Hanover Finance in July 2008.
The first stage of Five Mile, consisting of circa seven hectares, much of which has been excavated for an underground car park, was sold in November 2009 by Hanover Finance to Queenstown Gateway Trust Limited, led by well known Auckland developer, Anthony Gapes.
The sale is subject to various conditions and approvals which will be sought over the next month and Allied Farmers will keep the market informed once these conditions are met.
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