Property owners say ‘millions’ lost

Press, 3 May 1983, Page 3

Property owners say ‘millions’ lost

PA Wellington Commercial property owners say that they are losing millions of dollars through the rent freeze, and allege that they are more harshly penalised than other sectors. They say that commercial rentals are not reviewed annually and, therefore, have not been frozen at 1982 levels but at levels existing in 1979, 1977, or earlier. In a submission to the Minister of Housing, Mr Friedlander, commercial property owners asked the Government to amend the rent freeze regulations immediately so that commercial rentals can be adjusted to 1982 levels. Representa-

tives of the Building Owners and Managers’ Association, whose members own about 90 per cent of central commercial properties in the larger cities, presented the submission In the submission, the association expressed support for the freeze but said the rent freeze regulations were a clear exception to other freeze regulations and unfairly penalised the owner of tenanted commercial property. They said that virtually all forms of consideration frozen under the freeze, except commercial property rents, were at or close to present market levels at June 23, 1982.

Commercial property rentals were, however, subject to review at agreed periods ranging from 21 or seven years for ground leases such as harbour board or hospital board-type leases, to three years or in limited cases two years for more recent commercial leases. The association’s president, Mr G. M. Davies of the Angus Corporation, Wellington, said the average rent review period for commercial rentals was five years. “The Government have therefore frozen rents not at their June 1982 level but rather at levels existing in 1962, 1973, 1976, 1978, 1979, et cetera,” said the submission.