The Queenstown Lakes District Council this week approved a new lease to the Fun Centre for a term of 33 years, with a seven-year right of renewal. The new lease sets rent at 5% of turnover or $10,000, whichever is the greater.
The Fun Centre provides facilities for the district's ice sports codes, including figure skating and ice hockey.
The decision was made at a meeting in Wanaka on Tuesday after several months of negotiations with the new lessees, the Graham family, who took over the business on April 1.
The new lease variation was needed in order to extend the term beyond 26 years and make the business viable, the council was told by Joanne Conroy of Lakes Property Services.
The Fun Centre was granted a rates rebate until December 31, 2015 by the finance and corporate accountability committee in February.
The committee also required the Fun Centre to provide an improvement plan.
The property subcommittee also considered the new lease arrangements in March and approved the development programme, subject to several conditions including that the lessees spend $500,000 in first five years to upgrade the facilities.
The council notified its intention to consider the new lease in April and no submissions were received.
Councillors Gillian Macleod and Mel Gazzard were on the hearings panel.
Ms Conroy said in her report to the council that the Grahams felt that with the new terms and conditions and a longer lease, they had a good chance of making the business successful financially and for the community.
"It is hoped that the Fun Centre will be managed more actively and therefore perform better under the new management.
"This will mean more rent should be paid [that is, higher turnover], even with the percentage capped at 5%," Ms Conroy said.
