All creditors are expected to be paid from the liquidation of United Services Community Club once the sale of its South Dunedin premises is finalised.
An undisclosed but acceptable offer for the building has been made to liquidators Insolvency Management, of Dunedin, but the adjacent Montecillo Veterans Home and Hospital has first right of refusal and is responding to that process.
While the potential sale price was understood to be less than the $740,000 capital value of the building, there should be a balance for distribution once payment has been made to creditors, who are at present owed more than $324,000.
Since the building went out to tender, several Dunedin community and sports groups have shown interest in buying it as an ongoing hospitality venue, but the would-be buyer is understood, but not confirmed, to be a community-oriented organisation and compatible with Montecillo operations.
Insolvency Management said in its six-monthly report, released last week, an offer had been received that was "in the form and content acceptable to the liquidators". It was passed on to the Montecillo Trust, which has first right of refusal.
Iain Nellies, of Insolvency Management, was contacted yesterday and said that either the Montecillo Trust would come back and offer to buy the building, on the corner of Prince Albert and Bay View roads, or the other party would undertake due diligence.
He declined to give any further details on the potential buyer or future uses.
Mr Nellies understood that any surplus from the sale would be evenly split between the Dunedin RSA and a welfare association under the Ex-Royal Navalmen's umbrella, as required under a deed of trust.
The club, whose members were mainly from the RSA and Ex-Royal Navalmen's Association, was understood to have had dwindling membership and fees and was unable to sustain running a bar and dining facilities.
The building has a capital value of $740,000. Following an application by the United Services and Community Club Trust, the charitable trust that runs the club, it was placed in liquidation with Insolvency Management Ltd last July.
The liquidator's six-monthly report said creditors' claims so far totalled more than $324,000; $217,553 to secured creditors, $3331 to preferential and $103,267 to unsecured creditors.
"All claims are yet to be admitted. However, the offer is sufficient to repay all the creditors in full," a liquidator said in the report.
Mr Nellies has said in the past that, unlike other liquidations, where most creditors were "outside companies", the community club's debt was mainly within a group of associations and trusts.
