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The Dunedin City Council is looking to charge the Otago Museum rent for the still-vacant 133-year-old former post office building next door, despite continuing delays in refurbishing the building.
The Dunedin City Council-owned building - built in 1878 - has been vacant for more than three years, since the Otago Art Society moved to the Dunedin Railway Station.
In June last year, following a registration of interest process, the council granted the museum a lease to use the building for conferences, functions and exhibitions.
The building was to be given a $1 million upgrade by the museum and be ready for use by January 1 next year, when annual rent of $12,000 was to begin.
There have been few outward signs of progress and a council staff report to next week's community development committee confirmed the deadline would not be met.
Council reserves policy and planning officer Paula Gunn said the museum had confirmed "cost revisions and unforeseen delays" meant the building would not be ready for use until March 2013.
The justifications given were "realistic" and her report recommended shifting the deadline for construction to be completed to March 1, 2013.
However, the museum had not asked for the rent to be deferred, and she recommended leaving original plans in place, meaning rent would still be charged from the beginning of next year.
"The rental obligation may incentivise the museum to proceed with development as soon as possible," her report said.
Museum chief executive Shimrath Paul and exhibitions, development and planning director Clare Wilson were both overseas and could not be contacted yesterday.
Museum acting chief executive Helen Horner said in an email, plans for the building had been "updated to best fit within our strategic development plans".
In February, council community and recreation services manager Mick Reece told the Otago Daily Times questions were being asked about the "pretty prominent piece of real estate".
"Why's it still empty? Why isn't anything happening?"
Mr Paul responded by saying he did not think planning for the site was taking an "unduly long" time.
The building's interior was "a mess" and the museum was working with the New Zealand Historic Places Trust and its own architects to complete a conservation plan and finish the refurbishment design, he said.
Asked if the building would be ready for January 1 next year, he said at the time: "That's the aim ... everything else being equal and all going well."