CITY LEASES.

Dominion, Volume 6, Issue 1700, 17 March 1913, Page 3

CITY LEASES.

more about the case for the TENANTS, THE AUCTION,LEASE. Tho following statement in regard to tho present position of tho Wellington Corporation leases and the discussion which has arisen on the subject was made to a Dominion reporter on Saturday by a prominent member of- tho Wellington Leaseholders' ; Association "I have read ivilh great interest the statements made by tho Mayor and Mr. Gerald I'itzgeraUl. Tho hitter's remarks should carry iveight, because lie was an umpire in sonie of the arbitrations between the Corporation and the lessees. He was thus able to give an unbiased opinion as to tho effect of the leases. Furthermore, I gather that Mr. I'itzgerald is a freeholder. As pointed out Ijy Mr. Pitzgentld, you cannot compare the freehold and the leasehold. The Court of Appeal has definitely decided that tlio basis of 1 calculating the rent is 'not' to find the freehold value and take a percentage, but to find out what a lessee can pay for vacant land for 11 years with a right of renewal, on the terms of tho lease, etc.i The lessee must in some way calculate Vhat risks lie runs and make due allowances. It follows, therefore, that everything depends on the terms of tho lease. If these are advantageous the tenant can pay a much higher rent than if the terms are not advantageous and the risks are large. • J . ■ , L i "The lessees want an inquiry into the leases because they consider the present leases 'are not fair, and therefore really not in .the .interests of the city. A lease' fair to the Corporation ami to the tenant is what is wanted. "I gather from what Mr. Fitzgerald says that he has not had before him the auction lease; it is a mistake to think that under the auction lease the lessees get compensation; if anyone buys you do get compensation, but if tho rent is too high and no ono buys tile lessee has either to pay the rent fixed or forfeit the holding. Of course, in any lease, if anyone will buy, you get compensation or the equivalent. But, as pointed out in tho association's report, there is a further risk tinder an auction lease, winch the lessee must take into namely, that if tho lessee has established a business he may find someone tuu liirn up at auction, 'not because tho rent fixed by arbitration is too low, but becausn the goodwill of the business which is attached to'the site is considerable. So the lessee may be forced to buy back his goodwill, which belongs to him and not to the landlord. . "It is 110 doubt to the interests ot the citizens that the leases should be discussed from every point, of view, and probably the suggestion made at the leaseholders' meeting that a small independent commission of qualified men should be set up to inquire into tho merits of the matter indicates tho best course to adopt."