Lakeland Props on track

Press, 30 July 1986, Page 41

Lakeland Props on track

After only two years operation, including nine months as a listed company, Lakeland Properties is on track towards its objectives, and looks forward to another exciting year of further development, the chairman, Mr A. C. McKechnie, told the annual general meeting. From the initial Shotover Street building which was held at balance date 1985, four further properties — three in the commercial centre of Queenstown and one well sited at Frankton — have been added to the portfolio in the last financial year, and “The Country Lodge" has been added since March 31. Finance for this last purchase was arranged off shore. “With the advantage of single figure interest rates, and a satisfactory margin between profit generated and interest payments, your directors believe that there is an adequate buffer to compensate for any drop in value of the N.Z. dollar,” Mr McKechnie said.

“Although it is gratifying to see that internal interest rates have dropped from their peak, they must still fall a long way before equating with those of our trading partners. At current rates it is not commercially viable to borrow in New Zealand against property that will allow it to be leased for a fair rental and provide a satisfactory return. “It is essential that interest rates are further reduced if

costs are to be contained and New Zealand is to remain an attractive destination for overseas tourists,” he said.

“To date, all our properties have been purchased in the Queenstown area. With the tremendous growth in value of commercial property in Queenstown, this strategy has been confirmed. However, your directors need not confine their activities to the Wakatipu basin, but will look at any opportunity to invest wherever it may arise,” Mr McKechnie said.

“This will most likely be in property that has a tourist potential and in areas that are tourist linked.”

“The extra beds already olanned for the resort must

bring further increases in turnover and land values to New Zealand’s number one resort. The private sector is doing its part to provide the facilities for the tourist. But this will not reach its full potential if it is not matched by better communications. “The commencement of a full jet service from Auckland in October is long overdue. I would hope that planning is under way for the greater utilisation of Christchurch as the gateway airport for further direct flights from Pacific Rim countries, and, ultimately, the utilisation of Queenstown or the Upper Clutha valley for direct flights from Australia. “Urgent priority must be

given to upgrading the access routes to the Wakatipu, particularly the Haast Pass route,” he said. “If the full potential of the four area ski-fields is to be realised, a more positive approach must be taken to upgrading and sealing State highway 89 — the Crown Range road. Only then can Queenstown make its full contribution to tourism in New Zealand. “Budgets prepared for 1986/87 show a considerable increase in the expected final result but again these results will also be dependant to a large extent on the values of the properties owned at balance date,” the chairman said.