A £1300 GIFT.

Auckland Star, Volume LXII, Issue 95, 23 April 1931, Page 23

A £1300 GIFT.

I notice that the City Council has discussed the reduction of the ground rents in respect of three of the Civic Square lessees. This is one of the most remarkable propositions the writer has ever heard of. The action of the council in making an allowance to these three tenants of an amount of over | £1300 is nothing less than a gift of that amount from the ratepayers' funds. Perhaps some of your readers do not fully appreciate the position in regard to the leases, and imagine that this is an ordinary case of a landlord endeavouring to help a tenant during difficult times. A reduction of rent in such circumstances is very commendable—it helps the tenant to continue in business and helps the landlord by keeping the premises occupied. The circumstances, however, surrounding the Civic Square leases are entirely different. In the latter case there can be no question of reducing rentals for the purpose of keeping tenants in occupation or of ensuring a return from the leasehold property.

In the case of the Civic Square leases there is no fear of the lessees "walking out" and abandoning their undertakings. If the terms of the leases are not carried out, and the ground rents as set out in the leases are not duly paid by the owners of the leasehold property, there is nothing any surer than that the mortgagees will see that the terms of the leases are complied with. If the terms of the leases are not observed and the rent reserved therein is not paid by either owners or mortgagees, the land, buildings and all revert to the City Council without payment of any kind. Could any moneys in the wide world be more secure or more certain of due payment than, say, the ground .rent of the Civic Theatre, non-payment of which would mean resumption of the land, theatre and all, and the buildings (reputed to have cost over £200,000) would automatically become the property of the city ?

The writer realises that these are difficult times. Losses in rentals and real estate generally are being made all over the city, and, so far as the Civic leases are concerned, there can be no question of who is to bear the loss. Surely no one would seriously suggest that the City Council, who by letting matters take their natural course could not possibly suffer loss, should bear, or even share, any portion of losses that might occur in connection with the properties. How many councillors would make this reduction if they were the owners of the freehold themselves? Mr. G. W. Hutchison is reputed to be a sound business man. Does he, as a practical business man, consider it good business and in the interests of the city ratepayers to make this reduction ? RATEPAYER.