Taxing lease incentives – changes on the way

The government’s measures to increase their tax take through the targeting of the property industry looks set to continue. First we had the erosion of depreciation, followed by the changes to loss attributing qualifying companies. Now the government is proposing to change the way it taxes lease inducement payments. In the current economic environment it…

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Compulsory Zero Rating

A recent proliferation of webinars on the new agreement for sale and purchase and GST has raised some interesting points. Zero rating will still apply to the sale of a taxable supply but the sale and purchase of land now requires the parties to examine their GST positions and determine whether the transaction is compulsorily…

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Management rights under fire

The Auckland High Court has issued its decision on the management agreement for the Sentinel Apartments in Takapuna.  The body corporate was challenging the management arrangements put in place by the original developer.   The Court concluded that the management agreement is harsh or unconscionable in terms of section 140(5) of the Unit Titles Act…

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Supreme Court decision on Blue Chip and the Securities Act

The recent Blue Chip Supreme Court decision will come as a huge relief to families up and down New Zealand.  An argument had been made on behalf of numerous investors in Blue Chip schemes that Blue Chip had breached the requirements of the Securities Act.  In signing up mum and dad investors across the country…

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Cross-lease vs fee simple

Fee simple Fee simple ownership is true exclusive ownership and possession of the land and buildings on it. It’s ownership of what is below and above the ground (as is reasonable). Yes, others do get a say – for example the neighbours might have a say over fences; Council in terms of compliance with the District Plan…

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New agreement for sale and purchase

We have set out below a short summary of the changes in the new 9th edition.  There are some changes specific to unit titles and commercial transactions, which we cover separately.  The first section is potentially relevant to all agreements.  There is a lot to take in.  Some of the changes assist vendors, and some purchasers,…

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Conveyancing and sinking funds

Sinking funds are common in the management of commercial property. Increasingly they need to be considered in residential developments when dealing with the sale and purchase of the property. There are for example, FF & E Reserves (for replacing furniture, fittings and equipment). These are held in connection with apartments leased to hotel or serviced…

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Earthquakes and leases – what to consider.

The sight of the ADLS Fifth Edition 2008(2) commercial lease can bring a feeling of both comfort and familiarity. The ADLS commercial lease is widely used and understood. It is often seen as the form of lease that can ‘get the deal over the line.’ It is generally regarded as a fair lease, and not…

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Selling off the plans – what’s new

For the first time in a very long while pre-sale contracts for residential properties are hitting the market.  Residential developers and their banks have been keeping a low profile these last few years but things are beginning to change.  Changes in the law means there are some new things to look out for in agreements…

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Maintenance and Unit Titles

As 1 October 2012 approaches there is a big issue looming in addition to sorting out your rules.  It’s the change in the maintenance regime.  Not so much the compulsory requirement that a body corporate have a long term maintenance plan, which everyone seems to be on top of.  Rather the fact that the body corporate becomes…

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Changing rules – what does it mean to me?

By 1 October 2012 new body corporate operational rules are required under the Unit Titles Act 2010.  Most bodies corporate have started to prepare replacement rules. There are a number of things which are now covered elsewhere, not in the rules.  These include AGMs, elections, voting, insurance and maintenance responsibilities.  The new rules will focus…

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What is material?

Historically anyone making changes to a unit title development needed either to complete a redevelopment plan or to cancel the unit title plan and start again. Both options needed unanimous consent from all of the owners. Things are different under the Unit Titles Act 2010 but there are still steps to be satisfied.  Some of them are…

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