Pegasus Town in liquidation
Buyers are likely to hesitate about purchasing at partly-built Pegasus Town, near Christchurch, now that it is in receivership, despite assurances from the developer that it is business as usual, says one local real estate agent.
Friday, August 17th 2012, 12:00AM 
2 Comments
by Susan Edmunds
Developer Bob Robertson said difficulty refinancing a loan had caused the receivership but he said it would be business as usual for owners and buyers of Pegasus properties.
Andrew Cowdy, owner of real estate firm Cowdy and Company, said the receivership might depress prices and interest initially.
But he said it was likely Pegasus Town would rebound. “I think the stage is set and set very well. I would think they’ll get over it. Uncertainty does destabilise things and make people a bit wary but a lot of houses have been built up there. If the section is already formed there’s really no risk. Off the plans, you might think twice.”
The receivership action was taken by New Zealand Property Finance Partners, an investment consortium owned by Australia's Brookfield group and investment banker Goldman Sachs. The consortium bought a loan over Pegasus Town Ltd from the Bank of Scotland last year.
Pegasus Town had been trying to buy back the loan from Brookfield and Goldman Sachs, but could not get the finance.
Robertson said he was told that the receivership was to spur action and encourage the loan to be bought. “They said hopefully this will hurry you guys up… we found that a bit strange when we were on the cusp of a refinancing deal.”
He said Pegasus Town Ltd had no external debt, and all staff salaries had been paid until the end of the month. The receivership did not affect his company, Infinity Investment Group Holdings.
Robertson said the town was on the “downhill slide” to completion and was not struggling for cash. He said he thought the receivership issue would be resolved quickly. There had been $50 million of sales since Christmas.
Meanwhile, an Auckland developer has been declared bankrupt, owing millions of dollars for failed projects including the $250 million Soho Square development in Ponsonby.
The site was bought by Progressive Enterprises last year but developer Layne Kells was left with a $77 million debt for that project alone.
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Comments from our readers
Regardless, Pegasus has a significant chunk of the titled sections available to the greater Christchurch buying public over the next 12-18months.
You'd think (and hope) that the receiver or anyone else who picks up this project will keep calm and carry on.
It's already a great development and has a lot going for it.
Terrible shame how hard it is to get investment capital for ANYTHING these days!
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Bob Robertson is the Managing Director of Infinity Investment Group, which is the majority shareholder of Riverstone Holdings Ltd (RHL) - the company trying to get a concession from DOC to build a private-access monorail built over conservation wilderness, to the site of its hotel operation in Te Anau Downs. Bob Robertson is also the CEO of RHL (see http://www.infinitywanaka.com/about-us.html and http://www.fiordlandlink.com/about.htm).
Question: Can the $150 million or thereabouts monorail project really be financed by RHL if they are so closely linked, through Mr. Robertson's key management roles, to the Pegasus company that is just now going into receivership?
With all these companies owning other companies it does get a bit confusing. I suppose Mr. Robertson could answer the above question.
Another question for Mr. Robertson: Is he able to make a public promise that, if RHL does get the monorail concession from DOC, that RHL will be the ones to build it, and the concession will not be sold off first to another developer?
Until that question is answered, we are left wondering if the 'Fiordland Link Experience' is no more than an attempt to make a quick buck by gaining and then flipping a paper concession.