Social Welfare in rent squabble

Press, 15 February 1989, Page 9

Social Welfare in rent squabble

By

DEBORAH McPHERSON

The Christchurch Social Welfare Department is battling its Cathedral Square landlord, the Housing Corporation, over its rental.

The department is about to move to new premises in Hereford Street and in the suburbs, leaving the corporation without its main tenant in the 10-storey building. The corporation says the department is obliged to honour the lease, which will not expire before the planned staggered departure in the next 12 months. About 50 social work staff will be the first to vacate the building in two or three weeks, when they move to Hereford Street. The department con-

tends there is no formal lease agreement and that it does not want to use taxpayers’ money to pay rent in two places in the city. The department occupies iy 2 floors of the 10storey building. Neither party would say when the lease expires or how much rent is being paid, but the corporation’s director of corporate property, Mr Gary Grant, said the lease would not expire before the department moved out. The department’s project manager, Mr Dave

Elston, said it was paying normal commercial rental rates for the building but did not want to be paying a double rental with taxpayers’ money. Based on the lower rate for the city’s commercial rentals of $l6O per square metre a year, the department might be paying more than $1 million a year. Mr Grant agreed the loss of rental from its main tenant would be a “substantial blow” to the corporation. He said the corporation

was adamant there was a lease agreement when the lease was originally arranged in 1976 by the former Government Office Accommodation Board. The board eventually “hatched” Government Property Services, Ltd, but the Housing Corporation now owned the building. Mr Elston said the department’s legal advisers had assured it that agreements made previously were not legally binding since there had been no lease documentation.