McKenna meltdown: Westin management in receivership

Receivers have been called into troubled property developer Nigel McKenna’s company responsible for paying returns to Westin hotel investors.

The developer lost control of Lighter Quay Hotel Management, formerly Melview Lighter Quay Hotel Management earlier this week.

KordaMentha receiver Michael Stiassny was appointed to the company after creditors voted on Sunday against a repayment proposal Mr McKenna had put forward.

NBR first broke the news Westin investors hadn’t been paid returns by Mr McKenna’s company in May last year, and the problem has escalated since.

Mr Stiassny said the receivership would not affect the running of the hotel, operated by international company Westin which has no involvement in Lighter Quay Hotel Management.

Mr McKenna’s Melview Group built the 172-room, $130 million hotel at Auckland’s Viaduct Harbour. It opened in June 2007.

Receivers took over his $1 billion Kawarau Falls project at Queenstown in May last year.

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23 Comments & Questions

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Huh, no surprises here. "Meltdown", hardly?
This has been boiling away for some time now, it's reduced to good stock.

McKenna's holding a garage sale, soon. Want some pots and pans?

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Stock? Hardly, I think we reduced that further to a demi-glace by now.

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Yet another commercial hazard takes the good citizens down whilst retaining a very healthy family trust and all the time the legislators and regulators sit on their hands and look sideways.

NZ The white collar criminals paradise

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Honestly the glee with which some people revel in this makes me sick. Without developers who will build things and create the places we live in, stay in an work in? It takes balls and vision to develop anything especially in our tough environment, and especially if you are not going to build the cheapest ugliest possible rubbish but instead want to create something of quality. A distant bank decision can have huge repercussions - imagine you had to repay your mortgage in full, next week. What would or could you do about it?

Nigel McKenna has been vilified unfairly and deserves at least a balanced view of the contribution he has made.

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Well said Nigel!

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If you want to be brutally honest -- it's burnt residue at the bottom of the pot.

Steelo -- or Goldilocks -- pad, please.

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mckenna,may wang,but wait there is more

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Mckenna is of the few developer I have very high regard too. Tried his best, built quality and took risks which nz developers require. The same with Patrick fontein. Hope all the best too mckenna in the future.

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While you say McKenna was a good developer and built quality. It is when things go wrong that tell you the most about someones character. Like where did the money deducted from room owners to pay rates etc. go ? His honesty and intregrity is very much in question over these issues. Until he fronts up over this, most of the investors involved, hope he is left with nothing, as some of them will be as a result of his actions.

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For me this is the biggest issue of all related to all these developers and finance company owners.

i agree we need risk takers in this world to make things happen. Hell i am working for one right now.

but - what i hate is when it all starts turning pear shaped all of a sudden there is no money for the investors and they take the ultimate fall. Yet somehow all these so called risk takers, haven't really taken much of a risk of all - cause they have salted so much of thier "gains" away in trusts so that they avoid the grasp of the receivers etc.

So yes i 100% agree that we are a wonderful cowboy state here in little ol NZ and still even today, after all this, i can see no action from the Govt to actually address this bottom line issue for me.

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Last comment nails it on the head.

You are only a risk taker if you're the one carrying the risk!! If you cleverly lay off the risk to 'investors' whilst protecting your own family trust then that's nothing to be admired.

I have no issues with his quality and vision as far as architecture is concerned - but don't tell me that a dodgy leashold investor structure is visionary!! Nor that a hotel which hasn't made a cent since day 1 displays any sort of commercial nous.

Only one step better than finance company shareholders who strip massive dividends in the twilight hours before collapse.

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Is this the same Nigel McKenna that purchased Beaumont Quarter for $14m then tried to sell off the lessors interest for $75m a couple of years later with another couple of his associates??

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The one and the same, my son. The one and the same.

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Shows you the greed of the man and lack of good business acumen

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A ruthless & unscrupulous wide boy who built utter rubbish in conjunction with Hartners before he tipped them over. It's fairly easy to be a financially successful developer if you don't pay for the developments you sell. Other point worth noting is that there will be a whole set of structural problems emerging in those developments to mirror the leaky building issues - same compromised inspection regime. It may not happen until the next earthquake, but it will happen.

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I've lost most of my net worth living in one of his crappy plaster boxes that leaks in John Jennings Dr Albany built in 1999. He has since long liquidated that company that built it so his finger prints are no longer to be seen.

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Couldn't agree more. McKenna didn't take risks, his investors took the risks. Whatsmore, there was no integrity with this man. Behind the scenes he has been struggling with cash flow issues for years. Late payments blamed on computer glitches and other BS reasons. Did any one ever verify those excuses? Rates in Wellington paid with funds from Auckland. IRD repayment schedules for PAYE and GST. The Quadrant cash cow has kept the whole thing on its feet for too long, now it can't support the share wieght of numbers.

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Greedy Investors got burnt because of "unrealistic projected returns"

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Is it forward looking developers or "greedy investors" that we need? Did the developers put up their money? You bet they didn't, their money went straight into family trust funds and offshore bank accounts. Most of the investors were Asian mum and dad investors, just like those NZ'rs who put their money into Bluechip and Bridgecorp. Get real, it was the developers who made up the unrealistic projections. So is it fraud or, just business?

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The old saying goes "Do you jump when someone ask you to?"

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I hope the greedy mum and dad investors go bankrupt

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There's no chance the greedy developers will go bankrupt. They've taken precautions, haven't you Nigel & Rod & Mark!!!
With attitudes like these NZ is going nowhere. The fraudulent and repeated misuse of investor funds is astounding and yet d***heads lke Tom are still out there beating their little drums about greedy investors.

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Nigel McKenna still drives around town in his Maserati while people suffer because of him. Hope he rots in hell.

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