Property expertise to be sought

The Dunedin City Council wants to recruit a panel of experts from around New Zealand as part of a push to increase returns from its $95 million investment property portfolio.

The move was signalled at yesterday's council 2013-14 pre-draft annual plan meeting and would lead to a report detailing the change being prepared within months.

Council governance manager Sandy Graham, in a report to yesterday's meeting, said the investment portfolio was governed by a subcommittee of four councillors, which had the power to approve sale, purchase and developments of up to $5 million.

It was expected the move to an independent subcommittee and the recruitment of additional property expertise could increase returns to the council.

The change was also in line with recommendations contained in the Larsen report last year, which recommended a list of changes to the council and its group of companies.

That report warned property investment could be ''high risk'' without a carefully prepared strategy, and recommended the council's arrangements be replaced by a new board structure with additional expertise.

A review by consultant Mark Petersen, of D. H. Flinders NZ Ltd, also presented yesterday, recommended an independent subcommittee to remove any ''potential for political influence'' over the fund.

Council chief executive Paul Orders said the cost of recruiting and paying members of the new subcommittee could be absorbed into existing city property budgets, without affecting its dividend to the council.

Cr Neil Collins worried it would be difficult to recruit truly independent members for the subcommittee, but Mayor Dave Cull said that was why recruitment efforts would stretch across New Zealand.

Cr Syd Brown, chairman of the council's finance, strategy and development committee, said the portfolio was too heavily weighted towards investments in Dunedin, and needed to diversify beyond the city's borders.

That needed to be considered when the council recruited new talent for the subcommittee, he said.

Ms Graham's report canvassed options including the creation of a new council-controlled organisation for manage the portfolio, headed by an independent board of directors.

Her report made no recommendation, but councillors opted to pursue plans for the subcommittee and a report is to be prepared by May.

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