Contractors in dispute at Kawarau Falls

About 50 workers have been pulled off Queenstown's $1 billion Kawarau Falls Station development following a dispute between contractors.

CBD construction director Grant Blackmore confirmed his company had stopped work at the site on Monday.

"We are currently in dispute with Hawkins [Construction], so until that matter is resolved, we are not working on site.

"Things might develop over the next few days," he said.

He declined to comment further.

Hawkins Construction chief executive Chris Hunter, of Auckland, could not be reached for comment.

Cromwell-based CBD employed about 50 permanent staff and contractors at the site.

The Otago Daily Times understands workers were called into a meeting on Monday and told to stop work.

CBD was subcontracted by Hawkins Construction, which is contracted to build the 177-room Westin Queenstown, one of two hotels being built in stage 1 of the development.

A spokeswoman for the five-star Westin hotel, owned by Starwood Hotels and Resorts, told the Otago Daily Times last month the chain had stopped taking bookings.

The hotel had been in limbo since two companies associated with stage one of the development, Melview (Kawarau Falls Station) Investments Ltd and Melview (Kawarau Falls Station) Development Ltd, went into receivership in May.

Receivers Korda Mentha allowed work to continue despite the two Melview companies owing $180 million to Bank of Scotland International, which called in the receivers.

The receiver's second report says the bank had continued to fund the project with a further $62.8 million after the receivership.

More than $64 million was spent on construction, $1.6 million on receivers' fees and $795,645 on legal fees.

Rilean Construction is contracted to build Reserve and Central South, which are stage 1 apartment complexes.

Director Stephen McLean said yesterday the apartments were about six weeks away from completion and he had continued to be paid by the receivers.

"Our payments have been made in a timely manner as per our contract.

"We are progressing to completion as quickly as we can.

"The job has a good feel about it.

"It's unfortunate that others are not having as good a time of it," he said.

Receiver Brendon Gibson could not be reached for comment.


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