Mike's Minute: Real estate deals shouldn't be race-based

The Dixon Street building debacle surely allows us to ask some questions of the Treaty process. 

If you missed it, Dixon St Apartments sold for a million dollars to local Māori under their Treaty deal – the Treaty deal had a first right of refusal clause.  

Now my assumption, clearly incorrect, is you would get first right of refusal based on the idea that something of cultural or historic significance was coming to the market, and as local iwi you wouldn’t want to miss the opportunity. 

I didn’t realise this was a commercial free for all, where anything and everything for sale goes to local Māori first. 

Further, I had assumed, clearly wrongly as well, that in having a first right of refusal, that meant that long lost treasure, whether historic or cultural, would be returned to said iwi to be honoured and looked after in perpetuity, not flicked off for quick profit. 

So obviously nothing like that is remotely part of the Treaty deals. So first question: why not? 

Next question is: if it isn't, is it commercially acceptable to have a race-based clause when it comes to real estate? 

And even if it is, is it commercially acceptable to sell stuff cheap? 

For if you haven't followed the story, five minutes after buying the building, the new owners sold it on for $3 million. 

So under a special deal signed for, on our behalf, by our government, we, the taxpayer, lose $2 million on one building. 

Next question: how could a Crown agency, i.e. Kainga Ora, think $1 million was a good price for something that was clearly worth $3 million? 

And in that is the problem with not involving the free market. 

Next question: did anyone involved in the cloistered deal know what they were doing, and if not, given its taxpayers’ dosh, why not? 

Another question: was the Treaty process designed so tribes could get into real estate speculation? At what point was a Treaty settlement about putting past wrongs right versus turning tribes into speculators? 

This was a bad deal. The original owners of Dixon St, us, got stiffed. 

And we got stiffed because of a race-based real estate clause that arguably should never have been part of an historic arrangement in the first place. 

Final question: what are we going to do about it? Or more worryingly, is there anything we can do about it? 

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Episode Transcript

Speaker 1 (00:00):
Now the Dixon Street building debarkle. I'm thinking to myself
yesterday afternoon that the Dickson Street building debarcle surely allows us
to ask some questions that the treaty process doesn't it
if you missed it, Dixon Street Departments, Wellington sold for
a million dollars to Local mari under their treaty deal.
The treaty deal had a first right of refusal clause.
Now my assumption, clearly incorrectly is you would get first

(00:20):
right of refusal based on the idea that something of
cultural or historic significance was coming to the market, and
as local EWE, you wouldn't want to miss that opportunity.
I didn't realize this was a commercial free for all
where anything in everything for sale goes to Local Mariy first. Further,
I had assumed, clearly wrongly again that in having a
first writer of refusal, that meant the long lost treasure,

(00:41):
whether historic or cultural, would be returned to SAIDI we
to be honored and looked after imperpetuity, not flecked off
a quick profit. So obviously nothing like that is remotely
part of the treaty deal. So first question, why not?
Next question is if it isn't is it commercially acceptable
to have a race based clause when it comes to
real estate? And even if it is, is it commercially

(01:03):
acceptable to sell stuff cheap for If you haven't followed
the story, five minutes after buying the building for a
million bucks, the new owner sold it for three million.
So under a special deal signed for on our behalf
by our government, we the taxpayer, lose two million dollars
on one building. Next question, how could a Crown agency
I Eking Aura think a million dollars was a good
price for something that was clearly worth three million? And

(01:26):
in that is the problem, of course, of not involving
the free market. Next question, did anyone involved in the
cloistered deal know what they were doing? And if not,
given its taxpayer's dosh, why not? Another question? Was the
treaty process designed so tribes could get into the real
estate speculation? At what point was a treaty settlement about

(01:46):
putting past wrongs right versus turning tribes into speculators. This
was a bad deal. The original owners of Dixon Street
I US got stiffed and we got stiffed because of
a race based real estate clause that arguably should never
been part of an historic arrangement in the first place.
Final question, what are we going to do about it?
Or more worryingly, is there anything we can do about

(02:08):
it at all? For more from the Mic Asking Breakfast,
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