Since being frozen – along with the other assets in City Pacific’s First Mortgage Fund over two years ago, new fund manager, Balmain Trilogy have sold the 11,000sqm beachfront Pacific Beach site to a Chinese-back developer for $81.8m.

The developer, Ridong (Gold Coast) Development, has now settled on the purchase and are reported to already be working on plans for a twin tower development for the Surfers Paradise allotment.

It was only a matter of time, but following City Pacific’s collapse their waterfront headquarters on Miami Key in Broadbeach Waters are being liquidated by administrators.

The marketing campaign is due to begin shortly, however the sale will only make a small dent in the $100m or so debt the former financier owes the Commonwealth Bank.Сувенири

No sooner had the ink dried on the deal for a Chinese consortium to purchase the 11,000sqm Pacific Beach development site in Surfers Paradise than an obstacle appears to have surfaced.

Foresight Acquisitions, which amalgamated and jointly owns the property with City Pacific has placed a caveat on the sale of the property which could delay or prevent settlement.

Foresight has launched a claim in the Supreme Court for $25m from the now-failed City Pacific.  They are seeking damages for lost profits as a result of City Pacific’s failure to see the project through to completion.

After months in limbo, the jointly Foresight Acquisitions and City Pacific-owned Pacific Beach site in Surfers Paradise has reported been sold.

A Chinese consortium beat local developer Sunland to the property – but at this stage a price has not been disclosed.

The 11,000sqm site on the corner of Wharf and Old Burleigh Roads is the largest beachfront site amalgamated in recent years and the sale represents a significant expression of confidence in the local market.

Whether the Chinese group will continue with the existing approved development plans or apply for changes is not yet known.  One interesting fact is though: The group has obtained approval from the Foreign Investment Review Board to sell 100% of the project to overseas buyers (as opposed to the usual 50%) – suggesting that they plan to make a considerable number of sales in their home market.

After weeks of bitter legal battles, Balmain Trilogy has been awarded control of City Pacific’s First Mortgage Fund after the Federal Court handed down a ruling on the matter.

While the move will directly affect the unit-holders in the $630m Fund, it also raises questions about the future of City Pacific’s real estate holdings: most notably King Tide on Broadbeach Boulevard and the Pacific Beach beachfront site on Old Burleigh Road.

With the significant interest bill taken into account the two sites are estimated to owe the company in the vicinity of $220 million.  The Pacific Beach site has been on the market for several months and it has been widely speculated that King Tide will follow.  However, given the current state of the Gold Coast property market and the relatively small buyer pool for large development sites, any sale of either of these sites is likely to represent a significant loss.

After several applications were rejected on the basis of height, Bullish Bear Holdings has been granted building approval for the King Tide site on Broadbeach Boulevard.

The proposed building, featuring 91 luxury apartments over 25 levels – including a tri-level penthouse, now faces its next challenge: Getting built.

Bullish Bear, the local consortium that owns the site is realted to Foresight Acquisitions, a joint venture between local businessman Craig Perry and embattled financier City Pacific.  Foresight own (and are currently in the process of trying to sell) an 11,000sqm beachfront site at the south end of Surfers Paradise.

It is rumoured that the King Tide site is also likely to be taken back to the market to aid City Pacific in its attempt to repay its debt to the Commonwealth Bank.

In the wake of a collapsed $205m with a Korean company last year, and following increased pressure from financier Fortress Credit, City Pacific have placed their 11,000 sqm beachfront site on the corner of Old Burleigh and Wharf Road back on the market.

Assembled at a cost of over $100m in 2007, the site is believed to owe City Pacific and Fortress a figure approaching $200m.  However, following recent falls in the value of beachfront property, it is widely expected that any sale – whether it be the entire site in one line, or broken into portions – will leave a significant shortfall.

Following a collapsed contract late last year, Raptis Group and City Pacific’s development arm, CP1 have sold their jointly-owned site adjacent to the Gold Coast International Hotel in Surfers Paradise.

Originally purchased, along with the hotel, for a planned 4 tower development, looming debts have forced the sale.  Tipped to be a fire-sale and do little more than recoup a $15m debt owed to Lend Lease, the sale has surprised many by almost reaching the $30m price tag local developer Con Nikiforides had offered for it last November before the contract collapsed.

With the buyer’s identity subject to a confidentiality clause – but tipped to be an overseas party – the strong sale price is a positive sign for the local market.  The contract on the 1.15ha site, on the corner of Surfers Paradise Boulevard and Ocean Ave is due to settle later in the year.

Following a recent move by City Pacific to call recievers to three Gore companies regarding a $145m loan, Gold Coast businessman Craig Gore is bringing a $4m lawsuit against City Pacific and it’s founder – Phil Sullivan – relating to an investment in CP’s First Mortgage Fund.

Alleging ‘false, misleading and deceptive’ conduct by City Pacific, Gore is just one of thousands of investors who have been unable to redeem money invested in the $900m fund, which has been declared illiquid.

City Pacific CEO, John Ellis, who recently replaced Mr. Sullivan has merely stated that the company is “considering their position”.

Embattled property financier, City Pacifc, has been thrown a lifeline by the Commonwealth Bank, in the form of an extra year in which to repay over $200m worth of loans.

The company is still under heavy pressure from investors in its First Mortgage Fund to repay distributions, and will likely face a battle with local developer Craig Gore, as they seek to recover around $145m in borrowings.

The market recieved the news warmly, with City Pacific shares rising by 24% on the back of the news.