Govt. Offers City Loan For Rebuilding

Press, Volume C, Issue 29565, 14 July 1961, Page 16

Govt. Offers City Loan For Rebuilding

(From Our Oum Reporter) WELLINGTON, July 13. The Government has offered to lend the Christchurch City Council £442,700 to purchase land and properties in the Salisbury street housing reclamation area with the object of rebuilding in moderate-sized flats. This was announced today by the Minister of Housing (Mr Rae).

The Government will provide up to £50.000 to enable the council to acquire properties in the area, and a further sum of approximately £392,700 for the rebuilding of toe block to flats for rental. The loan offers are subject to the City Council accepting sole responsibility for the erection, letting and administration of the flats, financial and otherwise.

Both loans will be for a term of 35 years on a table basis. Interest on the major loan will be charged at 3j per cent, and the standard local body interest of 4 7-8 per cent, will apply to the land purchase loan of £50,000. “In addition to finding the money for the reclamation project, the Government will approve of a subsidy to the City Council on the basis of £2 for £1 on the loss sustained on the reclamation of the land in this 3J acre block,” said Mr Rae. “It is

understood that the loss resulting from the'purchase of toe properties, demolition of the buildings and clearing the site will amount to approximately 18.OT0. The Government’s contribution will thus be in the vicinity of £12,600. Rebuilding Spread “The rebuilding of the area will be spread over a few years. To assist the City Council during toe establishment period, the repayment of principal will be suspended on each annual advance (of say £Bo.ooo' for a period of five years from the date of each advance. This suspension of capital repayments should ease the council’s financial commitments in the initial period before the flats come into full earning. "Discussions between the council and the Government have extended over a fairly lengthy period, and the offer now made to the council is the result of my recent meet-

ing with toe council's housing reclamation committee,” said Mr Rae.

"The committee has done excellent work in fostering a scheme to open the way to rebuilding a decaying area in toe heart of the city. It has been most co-operative in its negotiations with me. and I feel sure that the proposal will be acceptable to the people of Christchurch.

"With the Government finding the capital money required. the way is now cleared for the city to proceed. The offer is directly in line with the National Party’s promise to assist local bodies with slum clearance projects," Mr Rae said.