Windfall from a mythical $10 campus?
The claim that Victoria University was sold the Karori campus for $10 is a gross misrepresentation of the way the University came to acquire the former campus.
It is a myth that has been actively perpetuated by vested interests and the ill-informed.
- In 2004, the University acquired the assets and liabilities of the College of Education by way of a government-approved merger
- It was at this point that the University became the beneficial owner of the campus and the assets and liabilities were included on the University’s books
- At this time the University also became fully responsible for the campus maintenance, upgrades, insurance and depreciation as well as the then financial challenges of the College of Education
- In 2010, under a new Government policy, the University was invited by the Crown to apply for the legal title of the campus for which it was already the beneficial owner (as outlined in the Crown owned assets document and by the information provided on the TEC website that refers to Crown asset transfer and disposal)
- The goal of the Government’s policy was to provide incentives for tertiary education institutions to improve the management of their Crown-owned assets, and to transfer assets into their own title or dispose of them where appropriate.
- In 2011, the University’s application for title was approved by the Crown
- In 2014 and 2015, the approved application for title was finally actioned by the Crown in three tranches. To ensure the title transfer was legally binding the transfer included a small financial consideration of $10. It is this financial consideration that has been misrepresented as a sale price for the campus, conveniently ignoring the large expenditure the University has made in the campus and its operation and also ignoring the liabilities assumed by the University in the merger.
- Since 2005, Victoria has spent over $10 million in construction, upgrades and maintenance work at the Karori campus along with around $1 million a year in operating costs
- The transfer of titles from the Crown to Victoria was not a one-off special deal for Victoria—all universities and other tertiary providers around New Zealand also had the opportunity to have titles transferred to them
We have used the interest on around $3.5 million received so far from divestment of parts of the campus to provide Ngā Hoe a Kupe Pathfinder Scholarships for students experiencing disadvantage from seven secondary schools in the Wellington region. We will use the additional proceeds to further strengthen our buildings. After that, any remaining funds will go towards offsetting the costs of redeveloping the University’s Kirk Building on its Kelburn campus, which is expected to accommodate students and staff of the Faculty of Education who moved to Kelburn prior to the closure of the Karori campus.
Watch a video of Vice-Chancellor Grant Guilford debunking the myth around Karori campus having been acquired for $10.
Beneficial owner is a legal term where specific property rights ("use and title") in equity belong to a person even though legal title of the property belongs to another person.