Mission Beach properties to be sold from under embattled developer

Mayfair 101 founder James Mawhinney at Mission Beach.
Mayfair 101 founder James Mawhinney at Mission Beach.

The embattled Mayfair 101’s plans to sell or rent out a swag of the properties it bought in Queensland’s Mission Beach have been put in doubt as the senior lender on the portfolio has begun putting them on the market itself.

McGrathNicol, acting for senior lender Napla, has tapped Ray White to sell the Mission Beach property portfolio, with the agency looking to dispose of the 107 properties in tranches to avoid a fire sale.

Mayfair had just revealed its own property strategy and was to receive feedback on Monday from provisional liquidators of its M101 Nominees unit, Grant Thornton.

But the senior lender, which had already taken control of a series of properties, has just kicked off a sales campaign via agencies Ray White and Tropical Property.

Mayfair 101 is battling to resuscitate plans to transform the area into a $1.5bn tourism mecca, that would include a revamp of the Dunk Island resort, but was hit by the appointment of Grant Thornton in August, with a court case in February to decide its future.

The Australian Securities & Investments Commission is taking legal action against the funds manager, which backed its property scheme with high-interest debentures, with the regulator seeking a wind-up of the M101 Nominees unit.

Ray White Mission Beach principal and marketing agent Dick Williams could not disclose a price for the first tranche of the portfolio at the time of listing.

“We will hear as things unfold,” Mr Williams said. “The market will determine prices.”

McGrathNicol is the receiver of the Mainland Property Group, which controls property at Mission Beach, while Dunk Island resort is back in the hands of the Bond family, which had sold the island to Mayfair last year.

Ray White’s Mr Williams and Tropical Property director Susie England have been engaged to undertake a formal marketing campaign for a selection of the Mainland assets and are promoting them to both owner-occupiers and investors.

The property portfolio is split between freestanding residential dwellings and vacant land, is to be released in staggered tranches and sold via expressions-of-interest campaigns.

The first tranche includes six residential dwellings and eight vacant lots.

Mayfair 101 was hoping to pursue its own plans in a bid to return capital to its investors. It had been paying Napla 24 per cent interest on the $15m it borrowed, which rose to a 40 per cent default rate.

Separately, Sydney-based law firm MC Lawyers is well advanced with plans for a class action involving the more than 100 investors Mayfair 101 had attracted.

Mayfair managing director James Mawhinney has previously insisted that investors will get their money back and warned that they risked losses if his plan was not supported.

Grant Thornton recommended liquidation and also identified potential breaches of the corporations law, which Mayfair has denied.

The first tranche of sales includes 14 properties — six residential and eight vacant lots.

According to CoreLogic’s RP Data database, Mainland has more than 80 individual dwellings across two property names — Mainland Property Holdings and Mainland Property Holdings No 2.

Most of the 26 properties owned under Mainland Property Holdings No 2 were purchased between September and November last year and there are concerns that Mayfair will suffer losses as the properties are sold off, even as the senior lender recoups the funds it has advanced.

– with Mackenzie Scott

This article originally appeared on www.theaustralian.com.au/property.