The $2 billion commercial development Five Mile Township in Queenstown has been placed in receivership.
Hanover Finance has instructed the security trustee to appoint Deloittes as a receiver, after Five Mile Holdings defaulted on a repayment on its $70 million loan two months ago.
Radio New Zealand understands Auckland developer Nigel McKenna has been appointed as agent to take over the development.
Five Mile is the idea of high-profile developer Dave Henderson, who as late Wednesday night was still trying to save the development.
Work began on Five Mile in 2007 and it currently consists of a large excavated carpark - touted by Mr Henderson as the largest such hole for a commercial development in the southern hemisphere.
The implications for Mr Henderson's holdings are unclear, but other creditors claim there are many cross guarantees, including a hotel, apartments and commercial properties.