$9.1m sale at resort a let-down for Trinity
Property group Trinity Limited has sold a "significant" portion of its interest in the Cumberland Lorne Resort at a loss just months after announcing a multimillion-dollar write-down on the property.
The $9.1 million deal involved the sale of 23 freehold apartments, conference centre and the resort manager's apartment, as well as the management rights over 91 strata-titled apartments in the 4.5-star Victorian coastal resort. Trinity estimates it lost $1.9 million in the transaction after costs, according to its announcement to the ASX.
The Trinity Property Portfolio had valued its Lorne holding at $17.7 million - including management rights - last June, but it was downgraded to $14.51 million in December. The write-down was blamed as the primary cause of the company's $3.7 million loss last year.
"The write-down reflects the depressed market conditions being experienced by the coastal leisure property sector and was also influenced by the recent marketing campaign that occurred for the [resort]," according to the group's half year financials.
Following two earlier apartment sales and a recent deal for a penthouse, Trinity will be left with only 14 apartments in the resort. These will be sold individually over the 2013 and 2014 summer seasons.
Trinity estimates the three sales will return a profit of $400,000 and the 14 apartments could generate an additional $1 million in profit.
The deal comes on the heels of another lacklustre sale for Trinity, which sold a 3000 sq m office building in Mulgrave for $7.7 million after valuing it at $7.7 million.