Charles Bukowski

Market downturn hits unit developers

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Market downturn hits unit developers

KIM MACDONALD, The West Australian April 19, 2011, 5:48 am

Two more developments have fallen victim to Perth's lacklustre property market, with apartments in a city skyscraper and a beachfront complex going into receivership.

Receivers KordaMentha have been appointed to 43 of the 138 apartments in the Elevation tower, developed by Sydney-based Quadwest Developments.

It is understood the developer had failed to sell the apartments in the tower quickly enough to meet loan repayments

The $500 million Raine Square tower in the city, developed by Luke Saraceni and his silent partner, Hossean Pourzand, has already been put into receivership.

cited from http://au.news.yahoo.com/thewest/a/-/newshome/9224275/market-downturn-hits-unit-developers/

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Typical Sandgroper. Stealing ideas and trends from Queensland. :nono:

Hey - I would resent that if I still gave a sh*t about WA:)

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KordaMentha said there was no discount on the sale prices, which ranged from $395,000 to $4.4 million, because it was obliged to seek a decent value for the homes on behalf of the bank.

the developer has finished the building and it's ready to move in but has only sold 30% of the units. what would the banks have required in presales? it depends on when they started getting bank finance, but at least 50%. it looks like the banks have valued the units low and refuse to provide finance to the unit buyers, and sales were not that strong to begin with.

here's the competition http://www.realestate.com.au/buy/property-unit+apartment-between-400000-5000000-in-perth%2c+wa+6000/list-1?activeSort=price-asc

It comes as all nine units in a single beachfront complex in Cottesloe go on the market after National Australia Bank appointed the insolvency firm McGrathNichol.

A development company called OTF 220 Pty, owned by real estate agent Adam Lenegan and accountant Blaine Kidd, bought the property for $11 million at the height of the boom in early 2007.

couldn't even sell one!!

when a real estate agent and an accountant team up you know it's the height of the bubble.

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when a real estate agent and an accountant team up you know it's the height of the bubble.

You need to throw in a an economist with a PhD to get the holy trinity and maximum losses.

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Go on gropers sell a $210M development for $60M. Beat that. Betcha you can't. :yes:

http://jesse-rotafor...california.html

It may be an urban legend but I read that during the great depression a skyscraper was sold for the same amount as the building costs for just the elevators.

When the tide goes out those who have powder dry can pick up some once-in-a-lifetime bargains.

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the developer has finished the building and it's ready to move in but has only sold 30% of the units. what would the banks have required in presales? it depends on when they started getting bank finance, but at least 50%. it looks like the banks have valued the units low and refuse to provide finance to the unit buyers, and sales were not that strong to begin with.

It sounds like an elaborate bank repossesion. The bank now has the asset on its books so there is nothing like the pressure Quadwest Developments had to pay out on their loans and pay investors, subcontractors ect.

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It may be an urban legend but I read that during the great depression a skyscraper was sold for the same amount as the building costs for just the elevators.

When the tide goes out those who have powder dry can pick up some once-in-a-lifetime bargains.

i think that's the situation in the US right now. housing affordability is at a 40 year low (since they started keeping records) and people are still opting to rent. the herd is a very, very, powerful force. if you can stay out of the way of the stampede you might do well. on the other hand you might well be trampled to death...

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