Councillors join forces to stop $32m Reading cinema deal
Thursday, 15 February 2024
A move to stop a $32m Wellington City Council deal, seen by some as corporate welfare for Los Angeles millionaires, is gaining momentum with a majority now possible to derail the plan.
At a Wellington City Council meeting next Thursday, Pukehinau/Lambton Ward councillor Iona Pannett plans to issue a “notice of motion of revocation” — a council mechanism to reverse an earlier vote and, if it gets the numbers, for the council to withdraw from a $32m purchase of the land under the Reading Courtenay Place cinema complex.
Councillor Nicola Young confirmed she was seconding the motion, with backers Ray Chung labelling the $32m deal a “vanity project” and Diane Calvert calling it “absolutely bonkers”.
Councillors Tony Randle and Sarah Free have confirmed their support for Pannett, taking backers to six. A vote would need at least eight on the 15-member council. But two — Nureddin Abduraham and Ben McNulty — are on the fence with others failing to return calls and emails.
The move to pull out of the deal comes amid a budget crisis as the city tries to find money to spend on failing infrastructure, with basics including pools and library hours in for potential cutbacks and paid, metered suburban parking suggested. The Reading cinema complex abruptly closed in 2019 after a damning engineer’s report and is seen as a magnet for anti-social behaviour.
Nīkau Ni Weera and Tim Brown indicated support for the deal. Mayor Tory Whanau, who with nine others helped hatch the deal over a $1400 ratepayer funded meal at a top Wellington restaurant, would not comment on the notice.
Pannett confirmed she had the necessary five councillors backing her notice of motion, meaning it would likely be voted on in late-February.
The Reading deal was previously so-secret that, after information was leaked to The Post, Whanau initiated a $43,000 external investigation which failed to find the leak.
It also leaked that the deal would see the council spend $32m buying the land beneath the cinema, which the cinema chain would theoretically use to strengthen the building and eventually have the option of buying the land back.
“I see it as corporate welfare,” Pannett said.
Sensitivity around what could be publicly discussed meant Pannett could not specifically say what previous votes she was hoping to reverse. But the investigation report from lawyer Linda Clark outlines what was agreed to: Buying the land using borrowed money and winding up negotiations with Reading International.
It appears that has progressed with council papers out this week showing $26.9m for the $32m deal has already been put into the council’s 2025-26 draft budget.
Pannett also hoped to put up an amendment on Thursday to remove the money from the budget.
“We shouldn’t be involved in the corporate world, we don’t understand it,” said Nicola Young, who is seconding the motion. “We are babes in the woods as we have proven before.”
Reading New Zealand is owned by Los Angeles-based millionaires Ellen and Margaret Cotter, who head the family’s entertainment and real estate empire. Reading International could not be reached for comment but the company’s New Zealand arm lists Steven Lucas as a director.
A woman at his $2.5m Khandallah home on Wednesday refused to comment and closed the door on The Post.
Brown said the deal would be of financial benefit to the council and help revitalise the area.
What is $32 million
64 years of council chief executive Barbara McKerrow’s $500,000 salary.
175 years of Mayor Tory Whanau’s $183,000 salary or 304 times the $105,000 salary for a councillor with no extra responsibilities.
Enough to fix 12,800 leaks based on earlier estimates that an extra $2m funding for Wellington Water would equate to 800 leak fixes.
3242 years of rates paid to the city council for Reading New Zealand director Steven Lucas’s Khandallah home.
6.4 million hours of parking in one $5-per-hour Wellington parking spot.
53,754 nights at the Ortega Fish Shack, where Reading International was taken, where you order every single food item on the current a la carte menu.
An earlier version of this story said Iona Pannett planned to introduce her motion on Thursday, February 15. This has now been moved to Thursday, February 29.