| Decision | Consent granted (retrospective) Section 12(b) Overseas Investment Act 2005 (the Act) |
|---|---|
| Decision Maker | The Minister for Land Information and the Associate Minister of Finance |
| Decision Date | 8 July 2021 |
| Pathway(s) | Benefit to New Zealand (Benefit to New Zealand - S&I) |
| Investment | An overseas investment being:
resulting in an interest in their indirect interest in approximately 1,118.75 hectares of sensitive land in Karikari Peninsula, Northland. |
| Consideration | In total, approximately RMB 264 million or approximately NZD 56.4 million |
| Applicants | Shanghai Yuehua-Kangjian Investment & Management Co. Ltd Gui Guojie |
| Vendors | Shanghai Juyuan Real Estate Development Limited Pei Zhan, Hui Kang Zhang, Huan Ho Zhong, Jian Wei Tang, Shao Qiang Qu, Pu Lie Xu, Yu Zhen, Xi bao Shen, Wen Yu, Ping Zuhang |
| Background | The Applicants are an upstream shareholder (Shanghai Yuehua-Kangjian Investment & Management Co. Ltd) and the 83.34% ultimate owner (Mr Gui Guojie) of Shanghai CRED, the owner of Carrington Estate and Whatuwhiwhi Top 10 Holiday Park in Karikari Peninsula, Northland. Shanghai CRED Real Estate obtained consent under the Act and acquired its original interest in the sensitive land in 2013 and 2015. Shanghai CRED was, and is, an established real estate development company in the Asia-Pacific region. At the time, Shanghai CRED planned to continue to operate the existing resort on the land in a similar fashion to the vendors, and to further develop it pursuant to a long term business plan. The investment was anticipated to generate additional tourism to Karikari Peninsula as well as sales from the winery, a significant level of additional investment into the business, increased processing of primary products through the vineyard, and environmental and historic heritage benefits through consultation with the Department of Conservation and Pouhere Taonga Heritage NZ. In July 2018, the Applicants notified the Overseas Investment Office that offshore changes in its ownership had occurred in November 2017, ultimately resulting in Mr Guojie’s increasing his indirect ultimate ownership of the sensitive land from approximately 39.92% to approximately 83.34%. Subsequently, the Applicants sought retrospective consent for these transactions. The Carrington Estate land consists of a resort and golf course, vineyard and winery, wetlands, residential land comprising an accommodation facility, a disused quarry, and other non-productive land being held for further development. Ministers have granted retrospective consent because they were satisfied that the investment had, and was likely to, result in a benefit to New Zealand that was substantial and identifiable. The Applicants have completed a number of investments on the Land to date, including upgrading and constructing accommodation facilities, and completing preparatory works required for expansion of the resort. Further development of the land has been hindered by rejection of the Shanghai CRED’s resource management application by Te Runanga-a-iwi o Ngāti Kahu, as well as a reluctance from shareholders to invest further capital where results were not forthcoming. With increased access to capital and willingness to invest following the shareholding changes, the Applicants now intend to fit out a new golf gear retail shop to supplement the existing golf course, expand the planted vineyard on the site, and set up additional clay target shooting facilities. These investments are expected to result in additional investment being introduced into New Zealand, will maintain current employment as well as provide further approximately 19 full-time equivalent job opportunities (in an area with few employment prospects), and will maintain Carrington Estate as a functioning business in a remote part of the country. The OIO imposed an administrative penalty of $20,000 for the retrospective consent. If consent had not been granted, the OIO intended to progress its investigation and determine whether or not to apply to the Court to require disposal of the assets acquired in breach and/or seek civil pecuniary penalties. |
| More information | Tessa Baker Chapman Tripp PO Box 2206 AUCKLAND 1140 |
| Retrospective penalty | $20,000 |
See the attached Assessment report linked below, which was published in response to an Official Information Act request: