Lotte heads for exit

Korean conglomerate on brink of deal to end painful exposure to Salacia Waters development

LOTTE, a huge Korean group which suffered “burns” after putting two big toes into hot Gold Coast property waters more than a decade ago, is on a leave-town roll.

The company, an international conglomerate with 60,000 staff, finally has found a way to end its exposure to the stressful Salacia Waters project at Paradise Point.

It’s done a deal to exit the last two pieces of undeveloped land it owns on the $90 million site that houses the part-built waterfront community – 1.08ha at the Salacia entrance and an adjoining 5.97ha.

The holdings are to be turned into housing lots, with the option to use some of those for three-level buildings with single-floor apartments.

Whether Lotte has sold the sites or remains a partner in their development is unclear.

Development of the 5.97ha is a joint venture between companies Sovereign Shores and Metacap Developments.

They also are believed to be involved in the smaller parcel in the wake of a sale of it at $7.5 million to Hope Island developer Keylin failing to go ahead.

The owners of Sovereign Shores are Brisbane developer Alex Jimenez and David Woo, with Nicolas Jimenez a director.

Nicholas also is a director of Metacap, with Sydney-based financial advisory firm Newell Palmer and Associates, a founder of the company, a shareholder.

Last year Salacia sold its only other undeveloped parcel, 1669sqm, to realtor Ali Mian for $2.5 million.

That sale, and the latest deals, comes after a 2016 sales push for the three undeveloped portions drew offers from listed groups Villa World and Sunland but failed to complete.

Lotte reportedly was aspiring to get $40 million or more. Its deal on the 5.9ha site appears to have been brewing for nine months or so.

The holding is earmarked for 58 lots, housing up to 100 titles, in a development tagged Sovereign Shores.

The first lots are on the market, with prices starting at close to $600,000 and quickly drawing buyers in the wake of surging land prices at elite ‘neighbour’ The Sovereign Islands across the water.

The smaller parcel, at 1.08ha, is intended to take up to 30 titles. Lotte, which it has been suggested could lose up to $200 million on its ill-fated Gold Coast forays, took full control of Salacia Waters in 2009 when a partner exited.

A year earlier the 10.8ha site had been bought for $90.8 million. The land was approved for 470 titles and 144 had been built (and all today appear to be sold) when work was halted seven years ago.

Meanwhile, Lotte is creeping closer to exiting its other Gold Coast exposure – the Victoria Towers over-50s high-rise in Southport.

When it took control as mortgagee in 2013, 191 of the 220 apartments were unsold, a figure that today is closer to 30.

THE LATEST DEALS COME AFTER A 2016 SALES PUSH FOR THE THREE UNDEVELOPED PORTIONS DREW OFFERS FROM LISTED GROUPS VILLA WORLD AND SUNLAND BUT FAILED TO PRODUCE A SALE