CBD
It involved legal shootouts, media cannon fire and plenty of hurt feelings, but one of the wild west's most colourful sagas looks close to an end after KordaMentha flogged off Luke Saraceni's Raine Square development in the Perth CBD.
KordaMentha was acting on behalf of the lenders, Bank of Scotland International and BankWest - the latter being awkwardly situated as both financier and anchor tenant of the mixed-use development.
While often spoken of as a $500 million development, listed property group Charter Hall paid $458 million for the building on Wednesday.
BankWest appointed KordaMentha as receiver of Saraceni's development group Westgem in 2011 after it missed a $50 million payment, sparking a bonanza for m'learned friends.
In one case, Saraceni alleged that KordaMentha had not been validly appointed. In another, he claimed $200 million in damages from BankWest's owner, CBA, claiming the bank deliberately tried to seize control of the building. He also challenged the validity of a bid by the corporate watchdog to grill him under oath and sued two KordaMentha partners, Scott Langdon and celebrity accountant Mark Mentha, for defamation. Despite the sale, the western serial looks set to continue in the courts.
While Saraceni lost the validity-of-appointment case and the ASIC case, the claim for damages and the defamation case continue - as does a case in which BankWest alleges misleading and deceptive conduct over $7 million raised from investors.
A Trak record?
Nigel Austin, the founder of clothing chain Cotton On, has emerged as the buyer of a pricey mansion once owned by former bankrupt John Elliott. Austin slapped a caveat over the property on Friday, protecting his rights as purchaser. There is some dispute about how much the rag trader paid former JPMorgan Australia chairman Brian Watson for the lavish estate in exclusive Toorak.
Some sources claim it set a M-Town record of $25 million, busting through the $24 million mark set by property developer Harry Stamoulis in 2010. But others claim it fetched closer to $21 million, a figure both more plausible and far shy of the $26 million for which agent Kay and Burton had hoped.
On a ginormous block, the Towers Road spread features all the mansion essentials, including a pool, tennis court, four-car garage, gym, walk-in cellar, six bedrooms, seven bathrooms and a partridge in a pear tree.
Big mansions are becoming an Austin trademark: last year he was revealed to be building a vast pile on a $10 million Hamilton Island block of land, next door to the late Beatle George Harrison's holiday house.
Pridham's Swans
Footy frenzy has engulfed the property world, with the 2012 AFL premiers, the Sydney Swans, appointing as chairman long-time fan and director Andrew Pridham.
Pridham, known as Mr Property, and chief executive of Moelis & Co, will replace another property director, Richard Colless, when he steps down in February 2014.
And there's more to come, with the Ray White EJ Whitten Legends Game looming next month.
For the 10th year in a row, Ray White - the largest property group in Australasia - will sponsor the showdown.
It pits recently (and not so recently) retired AFL types against each other in a battle of the states.
Last year's line-up included Anthony "Kouta" Koutoufides, Wayne Carey, Matthew Lloyd, Anthony Rocca, 2005 Swans premiership player Tadhg Kennelly, Mal Michael and man of the match Brendan Fevola. Fev's nine-goal haul handed the Vics back-to-back wins in front of a record crowd (for the event) of 26,221 fans.
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Frequently Asked Questions about this Article…
According to the article, receivers acting for the lenders sold the Raine Square mixed‑use development in Perth CBD. KordaMentha, appointed as receiver, sold the building and listed property group Charter Hall paid $458 million for the asset that is often talked about as a $500 million development.
The article says BankWest appointed KordaMentha as receiver of Westgem in 2011 after the developer missed a $50 million payment. Receivers are appointed by lenders to recover amounts owing by taking control of and selling secured assets.
The piece highlights a number of active legal disputes: Saraceni challenged KordaMentha's appointment and sued over other matters, he lost some cases (including the validity‑of‑appointment and an ASIC matter) but other claims for damages and defamation continue. BankWest also alleges misleading and deceptive conduct related to about $7 million raised from investors. For everyday investors, these types of disputes can create uncertainty about recovery outcomes, timing of payments and potential claims on funds raised for a development.
Receivership, as described in the article, is when a lender appoints an external party (in this case KordaMentha) to take control of a borrower's assets to recover outstanding debts. Property investors should care because receivership can lead to forced sales, changes in tenancy or management, and outcomes that affect asset values and investor returns.
The article reports Charter Hall paid $458 million for Raine Square, while the development has often been spoken of as a $500 million project. For investors, the sale price provides a real market benchmark for a landmark Perth CBD asset and may influence valuations and expectations for similar large mixed‑use properties.
The article says Nigel Austin, founder of Cotton On, emerged as the buyer of a lavish Toorak mansion previously owned by John Elliott and placed a caveat to protect his purchase rights. Sources disagree on the price — some claim about $25 million, others say closer to $21 million, while the agent had hoped for $26 million. High‑end residential sales like this are watched by property investors as signals about the luxury market and buyer demand.
Andrew Pridham is identified in the article as a long‑time Sydney Swans fan, a director and the chief executive of Moelis & Co, known in the article as 'Mr Property.' His appointment as chairman of the Sydney Swans is newsworthy to the property community because of his profile in finance and property circles and the crossover between sport, corporate leadership and property networks.
The article notes that Ray White, Australasia's largest property group, will sponsor the EJ Whitten Legends Game for the 10th year running. The charity exhibition pits retired AFL players against each other and draws large crowds (last year's event attracted about 26,221 fans). For property investors and industry participants, the sponsorship shows how major property brands use high‑profile community events for marketing and client engagement.
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