Wednesday, September 25, 2013
Oracle Gold Coast Losses
Saturday, February 16, 2013
The Oracle Broadbeach
Apt 2003, 2 bedrooms, now listed for $825,000, originally sold for $1,495,000 off the plan.
Apt 1605, 1 bedroom, sold off the plan for $710,000, resold in January 2012 for $530,000.
Here is another 2 bed listed for $800,000.
Friday, June 15, 2012
Oracle Buyers Loose Appeal
"... there is little support for the conclusion that, in addition to the role played by the Oracle name in identifying the apartments to be sold and purchased, there was also a promise by the vendor that Tower 1 be known or described as The Oracle at the date of completion. If such a promise existed, it needed to be inferred and the inference, if it could be drawn, was far from obvious. ... For the above reasons, I would order that the appeals be dismissed and that the appellants’ pay the respondent’s costs of the appeals, including reserved costs if any, on the indemnity basis."
The main reason the buyers did not settle was because the apartments dropped significantly in value between contract signing and settlement. That is a risk of buying off-the-plan, and is not a ground to refuse to settle.
Friday, April 13, 2012
Another Big Loss For Off-The-Plan Buyer
Purchase price for apartment 601 - $1,010,000
Plus holding costs & interest from settlement until court judgment - $196,631
Less estimated net proceeds if sold today - $700,000
Plus agents fees to sell - $29,645
Plus legal fees to sell - $2,200
Less Deposit - $101,000
Total owed = $437,476, plus interest at 12% until this is paid, plus legal costs of the lawsuit.
So this buyer lost a total of at least $538,476, which is more than 50% of the contract price for the apartment, and didn't get the apartment. Note that the valuation of the apartment dropped 30%. Take care when buying off the plan. (And read this book first!)
Wednesday, December 21, 2011
Off-the-plan craziness at The Oracle
The Oracle - Developer Wins Lawsuits
Interestingly, the judge's decision (which is long and complex) discussed issues about when a residential apartment building is and can be operated as a hotel or short stay letting operation.
"The contract provided that any authorisation of a person as a letting agent would be in the terms of the Caretaking and Letting Agreement annexed to the Disclosure Statement. That agreement provided for the entity appointed by the body corporate to operate a letting business, and to use certain common property for specified purposes. The letting business was not limited to long-term tenancies. Nothing in the Caretaking and Letting Agreement provided that the letting agent could not conduct its letting business so as to attract short-term tenants and holiday-makers. The letting business involved associated services commonly rendered in connection with letting lots in similar developments and “any other lawful activity.” This authorised the provision of services to guests occupying apartments, including guests staying for a short time who might require room service, a mini-bar and other “hotel-like services”."
"The fact that [the onsite manager] provides guests with certain “hotel-style services” does not mean that the tower has ceased to be a “residential tower” in the sense earlier described. The fact that some of the occupants are there for a short term does not mean that the tower is not a residential tower. The contractual promise of a lot in a residential tower relates to a tower used for residential purposes. The relevant provision distinguished the residential component from the retail component of the development. In its contractual context, a residential tower does not mean simply a tower for owners who are residents or long-term tenants."
Saturday, July 30, 2011
Oracle Broadbeach
Friday, June 10, 2011
Soul and Mirvac and Oracle and Hilton
LISTED property trust Mirvac Group will operate a luxury hotel at Juniper Group's Soul apartment complex on the Gold Coast.
It is understood Juniper had been speaking to potential operators about incorporating a hotel/resort in the development which had originally been planned as purely top-end apartments.
Juniper and Mirvac are close to finalising an agreement, industry sources say.
Apartment values on the Gold Coast have fallen by up to 50 per cent due to oversupply of projects, many of which were started before the global financial crisis.
The resort in the Soul complex will compete with Mantra's five-star Peppers Hotel at the newly- built $700 million Oracle Broadbeach tower and also the Hilton Surfers Paradise Hotel and Residences, which was part of a development launched by failed Gold Coast developer Jim Raptis.
There is a total of 20,000 hotel rooms on the Gold Coast.
The Hilton hotel is on the market with price expectations of more than $60m on behalf of receivers acting for ANZ.
Oracle was also placed in voluntary receivership in December by Michael Nikiforides, a director of South Sky Investments, a Niecon-related company.
It was also suggested Mirvac briefly looked at takeover target Oaks Hotels and Resorts, for which Thai-based conglomerate Minor International is now a majority shareholder.
Mirvac was not available for comment yesterday.
It is understood that at least 200 apartments in the Juniper Group's Soul apartment project at Surfers Paradise are due to settle in stages from July.
Industry sources said Juniper had been marketing the Soul apartments in Asia with the promise of three-year rental guarantees on a $2m apartment, equating to $2000 a week. There are still 92 apartments remaining for sale at Soul, according to the Midwood Report, although the group provided no details on sales in the complex during the February quarter.
The yet-to-be-completed 77-level Soul tower fronts both the beach and Surfers' main retail strip, Cavill Mall, on the corner of The Esplanade and Cavill Avenue.
INVESTORS who bought into the failed $700 million Oracle Broadbeach development on the Gold Coast have been trying to offload their apartments at auction, but are finding no buyers, according to real estate sources.
It bodes unfavourably for the 200-plus pre-sold apartments in the Juniper Group's Soul apartment project at Surfers Paradise, due to settle in stages from July.
It is understood Juniper has been marketing the Soul apartments in Asia with the promise of three-year rental guarantees on a $2m apartment -- equating to $2000 a week -- and has involved a corporate advisory firm.
Market sources said the apartments at Oracle, on Elizabeth Avenue, Broadbeach, had been put to auction after the investors had settled with the receivers. But the apartments had not sold, mainly because of an expectation receivers would put more stock on the market at steeply discounted prices.
Oracle was placed in voluntary receivership in December by Michael Nikiforides, a director of South Sky Investments, a Niecon-related company. Niecon, of which Con Nikiforides is the chief executive, developed Oracle.
One Oracle apartment owner said then he was aware of people who had bought apartments for $3.5m and had since sold them for $2.5m. As at January, it was believed the developer had secured about $160m from more than 400 pre-sales in the 505-apartment complex, and between October and January about 180 of those had settled.
The value of Gold Coast apartments has typically fallen by 30 per cent since the global financial crisis.
The Oracle project is believed to have cost about $700m, with up to $550m in loans from a syndicate including National Australia Bank, Westpac, Suncorp and Bank of Scotland.
Juniper's Soul, which unlike Oracle is not insolvent, has 92 apartments remaining for sale, according to the latest data from the Midwood Report, although the group provided no details on sales in the complex during the February quarter.
Wednesday, March 23, 2011
Soul Settlements Coming Up
Soul off-the-plan purchasers in the low rise section are getting ready for settlement. Soul is located at Surfers Paradise, in a prime location. It is a very high end high rise. Photo from March showing progress.
Valuers and banks for purchasers are looking at contracts and doing valuations. I have heard of a situation where the apartment was valued at 70% of the contract price. That may not seem to bad, but if the contact price is $2M, then the purchaser needs to find an extra $600,000 to settle.
And there has been no announcement of who will manage this complex.
Will Juniper survive, or head the same way as Raptis and Niecon?
One purchaser is trying to resell his 2 bed apartment for more than a 3 bed apartment is being valued at: www.soul-apartment.com/
Friday, December 24, 2010
2010 Brisbane Apartment Awards
- Mirvac's Tennyson Reach
- Niecon's The Oracle at Broadbeach
- Raptis' The Hilton Surfers Paradise
- Evolution.