This page is intended to give you an overview of the Otago University Ministry House project — what we’re aiming to achieve, how things are progressing, and what the timeline looks like from here — which we aim to launch in 2026.

 

Background

The University of Canterbury (UC) house has been a strong and fruitful base for The Navigators in Christchurch over many years. Its proximity to campus has made it an ideal location for hosting large student gatherings, fostering community through dinners, social events, Bible studies, and ministry activities. We’ve also built a positive and reliable relationship with the landlord, consistently providing steady rent, maintaining the property well, and even undertaking significant garden clean-ups. The landlord has generously kept the rent unchanged, but if their long-term plans were to shift, it could significantly impact our ministry presence and operations at UC.

 

As we begin developing the Otago ministry, it would be ideal for The Navigators to secure a property close to Otago University that can serve as a strategic base—similar to what we've experienced with the UC house. This space would support ministry activities while also accommodating staff, interns, or Navigator volunteers with conventional income.

Unlike a typical investment property, which prioritizes financial return through maximizing rentable bedrooms, this property needs to be designed around effective ministry. That means prioritizing communal areas and living spaces that foster hospitality and connection. Properties in Dunedin that meet these criteria typically fall within the $800K–$850K price range.

 

Structure, Ownership & Legal Vehicles

We’ve sought advice from Stuart Weir, a property law specialist, who has recommended establishing a Limited Partnership for this project. While this is a relatively newer entity type and less commonly known, it offers the greatest flexibility for holding the property and balancing the interests of both investors and The Navigators.

 

This structure is particularly advantageous because it:

• Maximizes tax efficiency for income and future capital distributions to limited partners,
• Provides limited liability protection, and
• Allows limited partners to remain anonymous.

 

While a Limited Liability Company (LLC) is a more familiar option, it doesn’t offer the same tax benefits, lacks anonymity, and must be wound up upon the sale of the property. Importantly, the entity we establish will have no legal connection to The Navigators of New Zealand Incorporated, our charitable legal entity.

 

How the Limited Partnership Works

The partnership will operate under the Limited Partnerships Act, relevant Limited Partner Regulations, and its own Partnership Agreement. This structure blends features of both traditional partnerships and companies, offering flexibility in operations while providing liability protection for certain partners.  Like companies that use “Ltd” in their names, a limited partnership is identified by the suffix “LP.” 

 

There are two distinct types of partners within this structure:

• Limited Partners – These individuals or entities contribute capital to the partnership but do not participate in day-to-day management.
• General Partner – This partner is responsible for managing the partnership’s operations and cannot also be a limited partner.

 

Each limited partner contributes capital to the partnership—this investment determines their proportional interest in the partnership, including their share of the assets and entitlement to receive distributions (returns) accordingly. The offer of a partnership interest falls under the scope of the Financial Markets Conduct Act 2013 (FMC Act), similar to the issuance of shares in a company. As such, it requires appropriate compliance with disclosure and regulatory obligations.

 

The Partnership Proposal

We are seeking investors from within our wider Navigators community who are willing to contribute a minimum investment of $50,000 (or more) toward this project. Our goal is to fully fund the property purchase without relying on bank financing. While we may revisit the $50K threshold if needed, our preference is to keep the investor group small to simplify administration.

 

We are proposing a fixed investment term of five years. At the end of this period, we would either:

• Wind up the partnership and sell the property, allowing investors to recover their capital, or
• Continue the partnership, provided all partners agree, or
• Establish a second partnership after five years, allowing a new group of investors to come in. In that case, the property would be independently valued and sold to the new partnership.

 

While we anticipate a capital gain over the five-year period, any gains would first need to cover initial setup costs (such as legal and compliance fees) and selling costs, (if applicable). Under current New Zealand tax law, limited partnerships are not taxed as separate entities. Instead, income and expenses flow through to individual partners, who are taxed based on their share. Additionally, capital gains on property sales are not taxed.

 

Returns

The property will be rented out at market rates, with rent paid by the occupants—staff, interns, or volunteers with conventional income. All rental income will be deposited into the partnership’s bank account, from which property-related expenses will be paid. Any remaining surplus will be distributed among investors in proportion to their capital contributions. For example, an investor who contributed 50% of the total investment would receive 50% of the annual surplus as their return. At the end of the five-year term, any capital gain realized from the sale of the property—after deducting disposal costs—will also be distributed on the same proportional basis.

 

Expressions of Interest

The next step is for you to confirm your desire to invest and inform us of your investment amount.  Our aim is to identify all committed limited partners by the end of September. If you would like to discuss this further, please let us know. We would love to hear from you and answer as many questions as we are able.   Please contact Tim - [email protected] or Leah - [email protected]

 

Time Frame

We’ve outlined the following draft timeline to guide the progression of this project:

 

July: register interest with Dunedin realtors

July / August: Confirm Our Limited Partners & Their Investment

September: Finalise Limited Partnership

End of September: signed partnership agreement

September – December: purchase property

 

Common Questions

1. Early Exit Scenario: Although the partnership is designed to conclude after five years, what happens if a limited partner unexpectedly needs to withdraw all or part of their investment before then?  A: The partnership agreement will outline a clear mechanism for such situations. If a limited partner wishes to exit, the process will begin by offering their share to the existing partners, giving them the first right of refusal. If no current partners choose to buy the share, the limited partner may then work with the general partner to identify a new investor from within the Navigators community. Alternatively, the limited partner may find an external buyer, but any new investor must be approved unanimously by the existing limited partners.
2. Who will serve as the General Partner?A: We will appoint a trusted individual from within our Navigators community to take on the role of General Partner. This person will be responsible for overseeing the partnership’s operations and ensuring that the interests of all limited partners are well represented and managed.
3. What expenses will the Limited Partnership incur? A: The partnership will incur some initial setup costs, which will be capitalised along with the property purchase. These include legal fees for establishing the Limited Partnership, property acquisition costs (such as LIM reports, builder’s inspections), and other related disbursements. On an annual basis, the partnership will cover ongoing property and entity expenses, including insurance, council rates, repairs and maintenance, accounting fees for annual reporting and compliance. Day-to-day property management and financial administration will be handled by Navigator staff at no cost to the partnership. All operating expenses will be deducted from the rental income, and any remaining surplus will be distributed to limited partners in proportion to their investment at the end of each year.