5900% rent rise if farm was not sold

The lessees of St James Station in North Canterbury faced a 5900% increase in rent should they have opted not to sell the property to the Crown.

Figures requested from Land Information New Zealand (Linz) revealed the authority proposed to increase rent on the 23,783ha property from $6750 plus GST a year to $400,725 plus GST a year, after an 11-year review.

The change in value was due to a new rent-setting methodology (which is subject to a Land Valuation Tribunal hearing) and an increase in land values.

Sources said the old rent was based on the value of land exclusive of improvements (LEI), of $300,000.

The new LEI value was $17.8 million and included amenity values and land in its natural state. Based on 16,000 stock units, the rent has increased from $19 a stock unit to $1100 a stock unit.

St James ran mostly cattle and horses.

The Stevenson family last month sold the historic property to the Nature Heritage Fund for $40 million, but they told farmer representative groups that the threat of a nearly 6000% increase in rent was not the reason they sold.

High Country Accord spokesman Ben Todhunter said in an interview that despite those assurances, it seemed the Government was bullying its tenants.

"They tried to buy it a few years ago, then increased rent 5900%, and now they secure the purchase. All along, high-country farmers say the Government is pressuring them with rent increases and the fear of rent increases to achieve [its] goal of creating high-country parks.

"The evidence with St James clearly points to the Government putting pressure on farmers to achieve the outcome it wants."

The Government offered about $30 million for the station about four years ago, which was rejected.

Linz business support manager Brian Usherwood said lessees could elect to have the Land Valuation Tribunal consider an appeal over its rent notification.

"The St James leaseholder did elect to take this option."

The lessees of Minaret Station beside Lake Wanaka have taken a representative claim to the tribunal, disputing a Government decision to include amenity values such as views when setting rents.

They argue lessees cannot use those assets without permission from their landlord so should not be rented on those assets.

High-country farming leaders have also claimed the Government was driving up land prices by paying well above market rates for whole or part property purchases.

In buying St James, the Government's Nature Heritage Fund paid $2500 a stock unit - up to four times the market value.