Investors in a proposed $550 million luxury golf resort in Ipswich backed strongly by local councillors are demanding answers from the project’s developer amid doubts about his rights to promote sales of the land and the management of more than $6 million in foreigners' deposit payments.
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Gold Coast-based developer Richard Turner has raised more than $10 million in deposits for his company, Brookwater Resort Residential, from about 160 mum-and-dad investors in Australia and south-east Asia by pre-selling units in the proposed Dusit Thani Brookwater Golf and Spa Resort at Springfield, although his separate landholding company lost control of the land more than a year ago.
Sales records obtained by Fairfax Media show he raised more than $3 million worth of the deposits after his company that owned the land went into receivership last year, including almost half a million dollars in October 2017 alone.
The documents claim that less than half of the deposit cash has been paid into a secure trust account in Queensland.
But Mr Turner denied any wrongdoing through his solicitors, Gold Coast firm Hickey Lawyers, which stated: “All sales have, to the best or our client’s knowledge, been made according to the relevant laws that regulate the sale of proposed lots.”
“All deposit monies provided to this firm are held in trust as required by law and invested as permitted by law,” the legal firm said.
Peter Pham, a Brisbane solicitor representing several purchasers from Australia’s Vietnamese community in Sydney and Brisbane, said his firm was making inquiries about the scheme with Mr Turner’s solicitors.
“The consequences could be very far-reaching,” Mr Pham said.
Tung Nguyen, principal of Southside Lawyers in Inala, said he too was seeking answers from Mr Turner's lawyers on behalf of clients.
“We have contacted the lawyers many times but it’s been very hard for us to get information,” he said.
Mr Turner's company lost control of the land when his main creditor, the wealthy Melbourne-based Hunt family, put his company Brookwater Resort Investments into receivership with debts of $30 million in October 2016.
Just a few weeks earlier, the then-mayor of Ipswich Paul Pisasale and his deputy Paul Tully launched the scheme for Mr Turner at a lavish “ground-breaking ceremony” at the site. Construction work is yet to start on the scheme.
Since the receivership, Mr Turner has apparently sold a further 43 apartments to buyers in Australia and Vietnam, according to sales records. The developer has maintained his office near the site with a staff of about seven and has a sales office in Hanoi employing a similar number.
The Hunt family, which has since June this year owned the land outright through one of its companies, this month began contacting real estate agents in Australia working for Mr Turner and asking they stop marketing the apartments.
“We’re telling them that they just can’t be doing this,” said finance broker Paul Smith, who represents Hunt Group. “It’s embarrassing. We own the land.”
Mr Smith said the new owners planned to develop the site using their own resources and had no need for pre-sales.
Mr Smith said the Hunt family and its companies had had no dealings or contact with Mr Turner since December 2015.
The official receiver to Brookwater Resort Investments, Max Prentice of Sydney insolvency firm BPS, also claimed that Mr Turner had no rights to deal with the land at Springfield.
“He’s got nothing to do with it,” he said.
Mr Prentice alleged the pre-sales conducted by Mr Turner would be worthless to any lender or owner of the land.
“He will have no title to assign,” he said.
Investors’ deposits of between $40,000 and $160,000, paid to secure furnished apartments overlooking the Greg Norman-designed Brookwater golf course, are now “in limbo”, according to Costa Nicodemou of insolvency firm BRI Ferriers.
“In circumstances where a developer has lost control of a site and there is uncertainty as to the completion of the project, then I would have thought those purchasers should seek legal advice,” Mr Nicodemou said.
Property lawyer Matthew Raven of Gadens solicitors said the situation was “pretty bizarre”.
“You don’t normally sell (units) after you’ve lost control of the land,” he said.
Mr Raven said that where deposits were held in a trust account in Australia, investors were “reasonably secure”.
When contacted by Fairfax Media, Mr Turner explained that the part of the scheme affected by the receivership “stop(ped) marketing a year ago”.
But real estate agents at national firms Harcourts and Ray White as well as Sydney firm Global RE have told Fairfax Media they are marketing the apartments, located on the land Mr Turner's company previously owned, under instructions from Mr Turner’s companies. Internal company documents assert that earlier this year, Mr Turner organised a sales conference for prospective investors at the Parramatta RSL.
Deric Ly of Global RE in Liverpool, NSW, who sales records show has sold more than 20 apartments at the resort with a total sales value of about $14 million, said he had been told there were even hopes for a “Stage B” release of a further 130 units at the scheme.
Mr Turner also said: “The other phases and parts of the resort are active based on agreements we have over the other 80 per cent with different partners where we are not the majority”.
But Springfield Land Corporation, which owns all the neighbouring land, said that while Mr Turner had once had development rights over some of it, this was no longer the case.
Springfield Land “does not have any arrangement with Richard Turner in relation to the balance of land”, a company spokesman said.
“All option agreements were terminated on 24 Oct 2016.”
Mr Turner's lawyer denied this, saying the assertion that the option agreements were terminated "is not consistent with what our client has instructed us is the current arrangement".
All the apartments sold so far are located on the land Mr Turner's company previously owned, according to sales documents.
Then-mayor Pisasale and Cr Tully each made separate trips to visit Dusit Thani facilities in Singapore and Bangkok last year.
Fairfax Media revealed this month that Cr Tully did not declare hospitality he received from the hotel chain on his trip, which he has never discussed publicly.
Marketing material for the scheme promises buyers “guaranteed returns” from leasing the apartments back to the resort operator to be rented out to holidaymakers, as well as the payment of interest on deposits.
The Vietnamese sales website also promises “support maximum points for immigration in Australia when purchasing Dusit Thani”.
Deposits for real estate in Australia must be paid into a designated local trust account. A spokesperson for Queensland Office of Fair Trading, which regulates real estate transactions, said the location of the purchaser was “irrelevant”.
Do you know more? Email scoop@brisbanetimes.com.au
