- Hamilton City Council paid $2m for a property to support Hamilton Zoo’s future development.
- The purchase exceeded the property’s valuation, with the council citing a “financial advantage” from GST recovery.
- The acquisition aims to provide new space for rhinos and improve zoo access and operations.
Hamilton City Council paid well above market valuation for a house next door to Hamilton Zoo, knowing it had a “financial advantage”, OneRoof can reveal.
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The council, which owns the zoo, confirmed last week that it had bought the 40,469sqm Brymer Road property, in Baverstock, for $2 million.
The “strategic purchase” was to support the future development of the zoo and give some of the rhinos there a new home.
A report drawn up by the council’s strategic property manager recommended to councillors that the council pay more than the independent valuation to ensure it won the tender. Councillors were told that the authority was, in effect, paying only $1.739m because it would be able to recoup $260,869 of GST.
“This effectively reduces the net cost of the property, giving the council a financial advantage and enabling it to make a more competitive offer,” the report said.
Hamilton City Council paid $2m for a 4ha lifestyle property on Brymer Road, in Baverstock, next to Hamilton Zoo. Photo / Supplied
The "strategic purchase" will support the zoo’s development plans and provide a new home for some of its southern white rhinos. Photo / NZME
The independent valuation of the property, from Property Guru, placed its worth between $1.372m and $1.711m. The property’s RV is $1.66m.
In the report, councillors were told that the vendors’ minimum acceptable price was $1.7m.
Hamilton City Council chief executive Lance Vervoort defended paying $2m for the property, telling OneRoof that the council needed to submit the “best offer possible” to secure it.
The council considered making a lower offer of $1.7m, he said, but staff felt it would not be enough to acquire the property, and that they might lose out.
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“Almost any price tendered will be subject to criticism – either too much if successful or too little if unsuccessful – because there is no transparency about the competing offers. The only real indicator of success in this situation is whether or not the property was purchased,” he told OneRoof.
Council was told after the tender close that two other parties had submitted tenders for the property. One of the offers was too low, and the other was identical to the council’s, he said.
Vervoort did not think the council had an unfair advantage over other buyers because any purchaser with a similar tax status would be in the same position to claim back the GST component of the transaction.
Bayleys agent Peter Kelly, who sold the Brymer Road property, declined to reveal how many offers he had received, but said there were “multiple”.
The well-maintained property on Brymer Road had been under the same ownership for more than 30 years. Photo / Supplied
Hamilton mayor Tim Macindoe says the purchase price will have no impact on ratepayers. Photo / Supplied
He noted that 25 groups inspected the property, and that every interested party, bar Hamilton City Council, wanted to live there. “It was a really nice home and well looked after.”
Hamilton City Council told OneRoof last week that the Brymer Road acquisition would help secure the future development of Hamilton Zoo.
The 40469sqm property backs onto Hamilton Zoo’s planned Rhino Management Facility and was expected to save the council about $900,000 by allowing easier access to the new enclosure.
Hamilton Zoo has already started using some of the land and sheds on the property and plans to move some of its southern white rhinos onto the block.
The council had signalled it might use the three-bedroom, two-bathroom home as visitor accommodation, but Vervoort said this was still a long way off. In the meantime, the three-bedroom home was being fenced off and will be rented out for $640 to $680 a week.
Hamilton Mayor Tim Macindoe told OneRoof in a statement that councillors had voted unanimously to secure the land. “A zoo is a complex operating environment. This purchase improves our ability to provide safer, more efficient back-of-house access, reducing disruption for our animal whānau and enhancing the safety and wellbeing of animals, staff, and visitors, while lowering long-term operating costs.”
When asked why the councillors ignored the independent valuation while making the decision, he said it was “strategic”, adding that there was no impact on ratepayers because the cost was offset by the sale of land in Rototuna for $5.15m in February last year.
“Acquiring this site helps protect the zoo’s future and reinforces its role as a cultural and economic powerhouse for our city for decades to come.”
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