Resort’s future in doubt
PARADISE Resort is likely to be sold off as administrators of failed developer Ralan Group try to salvage what they can of the half-billion dollars owed to its creditors.
However, most creditors hoping for their money back will have to line up behind major private lenders, who have registered mortgages over the valuable Surfers Paradise property.
Developer William O’Dwyer’s Ralan Group went into administration late on Tuesday, putting future development of five Surfers Paradise towers at risk and jeopardising the jobs of more than 200 Coast resort staff.
Administrators Said Jahani, Graham Killer and Philip Campbell-Wilson of Grant Thornton have been appointed to the group’s 58 companies, which include its developments, hotel, retail and hospitality operations on the Gold Coast and in Sydney.
Melbourne financier Wingate, an active lender in Gold Coast highrise development, loaned $36 million to the first stage of Ralan Group’s Ruby development, and are understood to have also tipped in for future stages.
Wingate holds a second priority mortgage over the Paradise Resort, which Ralan picked up for $75 million in 2015, with a first priority mortgage held by a subsidiary of unlisted public company Balmain NB. Other secured creditors named by administrators include the Australian Taxation Office, Westpac subsidiary St George and NAB.
Most of the 1189 off-theplan buyers in Ralan’s future Surfers Paradise towers and its Sydney development have been told their 10 per cent deposits are unsecured and may not be returned.
The majority of buyers signed unorthodox side agreements granting Ralan use of the deposits, which administrators believe have already been spent on expenses of the failed company.
Administrators have told purchasers of future Ruby and Sapphire apartments there was no guarantee a buyer of the property would go ahead with the planned demolition of the resort and progress the development. The future is also uncertain for the resort’s staff.
Wingate put up $34 million to enable building to resume on Avani tower The Beach at Broadbeach in 2016.
Its later investment at Ruby appeared risk free after a touted sellout of the first tower in 2015, however records have revealed one in five of the apartments failed to settle.
The Bulletin has contacted Wingate for a response.
The first meeting of Ralan Group creditors is due to be held at the Wesley Conference Centre in Sydney at 3.30pm next Friday.
BUSINESS, P68
Wednesday’s Bulletin front page