The remainder of the 42-apartment development in the former Catholic Dominican convent grounds in Northeast Valley was sold to an Australian company last month, but Gardens View developer Bill Lowe then placed the company in liquidation as the sale proceeds did not cover all the debts owed.
The first report of Dunedin-based Insolvency Management Ltd (IML) said the sale of the development "in a soft market" did not generate the financial return required to repay the secured creditor in full.
"As a consequence, there were no funds for the preferential and unsecured creditors," Iain Nellies, of IML, said in the report.
Fifteen of the 42 Santa Sabina apartments in the complex have been sold and are not involved in the liquidation, while the remaining development sale allows the Australian company to build the balance of 27 units.
It was understood, but not confirmed, that the unidentified company planned to go ahead with the development.
Mr Nellies said the amount owed to secured creditors and Inland Revenue, as a preferential creditor, was still to be determined, while $176,447 was owed to unsecured creditors, less the costs of liquidation.
Despite the unlikelihood of any payment for the unsecured creditors, Mr Nellies urged them to file a claim so the investigation could confirm the overall debts.
