Unsecured creditors owed $3.5 million by an Auckland property developer are being asked to accept 15 cents in the dollar or see the company go bust and get nothing.

• Published date: 17 June 2024
• Author: Maria Slade
• Publication title: Northern Advocate, The (Whangarei, New Zealand)

Sanctum Projects builds townhouses and apartments in the city’s well-heeled eastern suburbs and is ultimately owned by longtime developer and landlord Aaron Ghee

It has told 92 trade creditors out of pocket by a total of $3,478,693 that the alternative is liquidation, and after lenders, preferential creditors and liquidators were paid, they would be unlikely to get anything.

One builder, Vivian Construction, is owed nearly $1m, while the Environmental Protection Authority is down $305,400 and Mitre 10 is overdue $210,000. A number of other suppliers including architects, engineers and lawyers are owed amounts ranging from $180,000 to a few hundred dollars.

In the compromise proposal document put to creditors, Sanctum blamed the issue on a lack of liquidity because of a 19-townhouse development in Mission Bay being a year late.

Although it had terminated the main contractor on the Dudley Rd project in November, that firm had gained a freezing order against Sanctum, Ghee, and the entity that owns the land, it said.

But the main contractor, N Cole Construction, told BusinessDesk it had all but completed...