Resort Corp kills sale rumours
RUMOURS that Resort Corp's The Beach at Cabarita has been sold to pay part of the developer's $300 million debt are untrue, according to a solicitor representing the ailing company.
While all assets owned by Resort Corp are “effectively up for sale”, according to Andrew Robinson from Robinson Legal, no offers have been accepted by the development company's creditors.
“When you get to this point when a company goes into administration, effectively everything is up for sale, but I can confirm that The Beach apartments at Cabarita have not been sold,” the Sydney-based solicitor said.
“But if a person was to come forward with the right offer, then that offer would be considered by the company's creditors.”
The development company, part-owned by Tweed identity Paul Brinsmead with business partner Peter Madrers, went into voluntary administration last month due to cash-flow problems, creating an uncertain future for millions of dollars of development on Queensland's Sunshine and Whitsunday Coasts and in the Mackay region.
The company, which has left its mark on the Tweed by developing luxury projects such as Santai at Casuarina, as well as the Zen, Nor Nor East and Soraya apartment complexes at Kingscliff, is believed to owe creditors in the vicinity of $300 million, but has assets valued at more than that amount, according to Mr Robinson.
Resort Corp came into trouble when the credit needed to continue work on its many projects, including a $500 million residential and resort development planned for Townsville, could not be secured because of the global credit crunch.
Mr Robinson explained that having so many projects in the “planning and land bank stage or being held for future development” created cash-flow problems for the company, and the directors had no choice but to place Resort Corp in administration.
“Another creditors meeting will be held next month where several proposals for the sale of assets will be put forward and considered,” Mr Robinson, who represents Resort Corp's board of directors, said yesterday.
“A large number of creditors were represented at the first creditors' meeting (held in Brisbane on March 12).
“At the meeting the creditors unanimously agreed that the company would proceed with the administration process.
“This involves looking at proposals for the sale of assets as well as other measures.
“I have attended a lot of creditor meetings in my time, and when the meeting was open to questions from the floor not one creditor said one word in anger; there was an acceptance that taking this path was the right thing to do.
“Everyone is focused on reaching the best outcome for Resort Corps' creditors and the process that has been put in place by the administrator David Clout (from David Clout and Associates in Brisbane).”