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The $2m Serepisos secret is out

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The Serepisos secret is out.

A month ago when we published a series of articles asking the Wellington City Council for more information about unpaid rates and ground rents, the whole town seemed to know that Terry Serepisos was involved. But the council guarded its secret.

Its audit and risk committee met behind closed doors. Its members weren’t given reports to consider in advance of the meeting. Instead, debtor reports were handed out only after the public had been excluded. All copies of the reports were taken back from the councilors before the meeting ended. The names of those who had failed to pay rates and ground rents were not printed in the reports. The council had a high level of anxiety about keeping a prominent name out of the media.

Today Dave Burgess and Phil Kitchin have broken the story in the Dominion Post and reported that the high-profile Wellington property developer owes about $2m in unpaid rates and ground rents to the city council.

Their report says that, amid growing concerns at the mounting debt, the council is believed to have given Mr Serepisos extra time to pay his overdue rates because senior staff fear potential repercussions for the Wellington Football Phoenix franchise which he owns. It says council chief executive Garry Poole has been involved in closed-door meetings where the debt level has been discussed.

The Dominion Post makes this comment:

Money not paid by Mr Serepisos is money that the council must make up in other ways, whether by borrowing, or by increasing rates or charges.

At around $2 million, the sum is not trivial. Mr Serepisos is not a homeowner who has fallen a bit behind, but the head of a property empire that, by his own estimate, is worth $450 million. It is not the role of the council to subsidise that empire.

The newspaper also reports that there is more than $200,000 of unpaid work on Mr Serepisos’ new Century City Hotel in Tory Street. It names four contractors who are owed money by Mr Serepisos and it claims some of the unpaid contractors have been bullied.

What happens next? One option is no doubt already being considered by the council. It has the legal ability to approach banks that hold a mortgage to demand overdue rates payments when the owner has failed to pay them. Mr Serepisos’s Century City website says the company is “at the forefront of property development and investment in Wellington.” The Century City empire includes the Todd Building, the ASB Tower, as well as 173 Victoria Street and three buildings in Petone. There seems to be no reason why the council shouldn’t be willing to take legal moves to recover the unpaid rates and ground rents.

Read also
March 18
Why the secrecy about risk?

March 20
Why the secrecy about the council’s debtors?

March 22
Audit and risk committee meets behind closed doors

7 comments:

  1. Cathy, 24. April 2010, 11:19

    If I hear ONE WORD about the “good” that Mr Serepisos has done for Wellington as some sort of excuse from Kerry Prendergast or the Council to give him more time to pay back the money, then I’ll scream. The Council MUST act now on behalf of ratepayers and move to seize assets to recover that money. It has a moral responsibility to do so.

    Or is there something else going on behind the scenes that we don’t know about? I mean, after all, Serepisos is a property developer. And there are people with links to property developers in the Wellington City Council. It seems very unusual that the local authority tasked to provide good stewardship over the money it gets from ratepayers should go to such lengths to protect the name of the person who owes millions… even to the extreme of not telling the Councilors on the audit committee.

     
  2. Alex, 24. April 2010, 13:27

    Why are we singling out Terry Serepisos alone? What about the others? Should we single out just one individual just because his name is out there? I am not a big fan of the person but I am all for transparency! Let it be known and open who’s who on the list of who owes the WCC. Who owes the other $8M?

    Vote transparency and out with the politics of the elites.

     
  3. ViV, 24. April 2010, 19:00

    Alex, you’re right. You may find, in time, the others are very well known to us all.

     
  4. Mike, 25. April 2010, 8:41

    Terry Serepisos has already “singled himself out” by creating a media profile in order to sell himself, his businesses and franchises.

    That he heads the business TV show “The Apprentice” is the supreme irony that gives traction to this news story.

    They should have a challenge episode about how to avoid paying tax/rates and get breaks from officials. Now THAT would bring the reality back to “reality TV”, about how big business really operates.

     
  5. Foggy, 26. April 2010, 19:29

    So it transpires that it is not Serepisos who has funded the Wellington Phoenix, but us Wellington ratepayers in the form of the $2million dollars he owes us. Kerry Prendergast is reported as saying “We’ve been working closely with Terry”. Does this comment refer to the $2million extended credit?? She should clarify this and inform the rest of us how we too can borrow a couple of million dollars from the council. Or do only property speculators qualify?

     
  6. Peter, 28. April 2010, 13:10

    I doubt if Serepisos is being subsidised … in fact, the longer he fails to pay the better for us ratepayers. He has to pay 10% interest on the overdue sum, apparently, and that is more than the council will be getting on its cash investments. And there is no chance of their not getting his money because in the final analysis, they can make him sell property and hand over the arrears, since the council stands first in line on assets in these situations. Kerry Prendergast should not be beaten up for not condeming the man who, if pushed, could pull the plug on the amazingly popular Phoenix and then claim it was all the fault of the council. She knows what she is doing and I for one don’t think there is a chance of our losing any money over this

     
  7. Foggy, 4. May 2010, 20:39

    I have just finished watching my first and only “The Apprentice”. I squirmed with embarrassment, and wondered if Terry Serepisos did the same? i guess not. The people who should have squirmed the most are the mayor and councillors. However I doubt if they will. After all, it is only public money they have allowed to be possibly lost, and at least they have taken $1.32 million directly from the mortgages of 571 homeowners who hadn’t paid their rates.
    And who cares about the subcontractors anyway? They don’t own Lamborginis!