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Cabin co-owner and Wanaka local Simon Stewart said he and his wife Danni had fought the Queenstown Lakes District Council for four years to reverse the decision to have the building removed, and it had cost him thousands of dollars.
"They [the council] considered this building unsuitable for their new Wanaka Lakefront Development plan but there has been buildings of one type or another on the Lake Wanaka foreshore since 1876," he said.
The log cabin was purpose-built 23 years ago to house hire equipment and to allow boating businesses to operate from the lakefront.
Five years ago, Mr Stewart sold outdoor activity company Lakeland but retained ownership of the building.
His 20-year council lease on the lakefront site expired in 2017 and he had renewed it on a monthly tenancy arrangement.
In May, the Wanaka Community Board granted Lakeland Wanaka a lakeside reserve licence to operate on the same Roys Bay land formerly occupied by the log cabin.
Co-owner Michael Donald said since then the company had only been able to offer a pre-booked jet boat ride as it was still awaiting delivery of a new mobile office, storage and trailer.
"We are just waiting until summer kicks in, and we should be organised by that stage."
Mr Stewart said he still found talking about the log cabin "an emotive experience".
He said the current operators of Lakeland were operating from exactly the same place, but without the building.
"They have to bring in all their equipment every day and it has to be off the beach at night, which is not very green or practical really."
Wanaka ward councillor Quentin Smith said the council had worked with the lessee over an extended period and offered terms to extend the lease to allow the building to stay, while still trying to retain some flexibility of options for the further improvement of the public domain.
He said the council even offered to buy the building at the end of an additional term but the lessee did not take up any of those offers.
Mr Stewart said he planned to renovate the log cabin into a three-bedroom home.