SALE OF UNION HOTEL

Greymouth Evening Star, 28 July 1945, Page 4

SALE OF UNION HOTEL

COMMITTEE APPROVES DEAL Permission to sell the Union Hotel, Herbert Street, Greymouth, to W. D. Smart was sought by John Darwell r (Mr J. W. Hannan) in an application I to the Westland Land Sales Com-1 mittee (Messrs M. Wallace, J. W. c Greenslade and J. Mulcare) at Grey-1 mouth yesterday afternoon, and after i, a brief hearing consent was granted at the figure sought, £12,000. | The Commissioner of Crown Lands, .< Mr N. Clay, said the Crown was ob- t jecting to the price, but accepted tne value placed on the furnishings, . £lOOO. He stated that the Crown valuations of the land as a freehold | was £525, but the lessee’s interest . was £325. !( Mr Hannan said the position was, that goodwill had to be established at I £7,000. The total price asked was £12,000, with £l,OOO for the furni-| ture, leaving the value of the gooaiwill, building and land £ll,OOO. The ; land and building, he submitted, were i worth £4.000, leaving £7,000 lor ' goodwill. On the basis of a weekly ( i turnover of £154, this basis having . I been accepted in the case of the sale , :of the Oriental Hotel,. Dunedin, and . ■ used' in connection with the sale pl ; the Suburban and Richmond Hotels, the value of the goodwill would be £7,186 in the present case. ■_ Mr Hannan continued to make further submissions to establish the 1 value of the goodwill when Mr Clay announced that he had misunderI stood the position and now had no ■ objection to the sale at the pricesought. .J On the basis of comparative sales of other properties in the Grey uis-s trict and on the sale at Dunedin of i the Oriental Hotel, the chairman an-1 nounced that the committee wpuia give consent to the sale at £ll.OOO for the goodwill, land and building and £l,OOO for the furniture. ROSEWALL’S CASE Further evidence in connection with the application of E. Rosewall (Mr J. W. Hannan) to sell his shop in Tainiu Street to W. C. and A. S. Wright, at a price of £2,750, was tendered to the committee. The chairman stated that the committee had been asked by thewendor to determine a fair value /or the property on the basis of the former sale. The evidence for the Crown gave a value of £682 for improve-j ments. This had not been disputed by the vendor, and the committee could only assume that renovations and alterations carried out since the property had been purchased by tne applicant in 1938, had been taken into account by the Crown and. the balance of the consideration, £2obb, must apply to the unimproved value of the section. While realising the site value of the property, the committee found, on a basis of per loot of frontage—the value m this case being £156 per foot—it was difficult to determine the value. The case, therefore, had been adjourned to allow further evidence to be tendercd Mr‘Hannan stated that he understood the Crown had admitted that the Government valuations of shops in the business area were not on a fair basis, and that they had based . their valuation on the sale of the National Bank property m Street in 1935, at £B3 a foot of frontage. He took it that if the price ; paid for the property by the vendor in 1937 was reasonable, it was reason- > able, in 1942 also. Mr Hannan . quoted per foot of frontage prices o v i other properties in the vicinity, in- : eluding Moore to Harrison, a propeity ’ adjoining vendor’s, £l4B in March, 1938; Kyle to Owen, a property adjoining Rosewall’s m Tainui Sheet, ‘£l27/10/- in 1937; Williams to ! Sutherland on the .opposite side ol > ainui Street, £126 in 1940. ? G. F. Shallcrass , valuer, gave > lengthy and detailed evidence coni cerning these prices, and he also pi.o- -[ duced a graph showing a steep rise i in business property prices in tne vicinity up to 1938. ; After considering the ma tt?r lor i some time the committee decided to r approve the sale subject, to a less duction of £ 100. The chairman, an t nouncing this, said that theie wa. . some considerable goodwill in.the site . value of the property.and the puce j paid in 1938 was indicative of this > The committee considered that the i price paid then represented the maiketable value of the Property in 1942. The committee, he added, had been r asked to consider a further sum pain s for the goodwill value ol the lease ol I the former lessee, and, by. reason of l the Crown agreeing, had allowed this 1 figure as a tolerance. The sale would . be allowed subject to a reduction to . £2650.