Following closely on the December judgment compelling luxury Broadbeach apartment buyers to settle on the 11 high-rise contracts they signed in 2007, a court has heard evidence of a 34% Oracle towers valuation collapse.
Developer, South Sky Investments Pty Ltd sued off-the-plan tower 1 buyers, Peter and Debra Lupi for their default in fronting with the $1,010,000 purchase price of unit 601 in December 2011.
Because the property had not been re-sold, South Sky’s receivers were looking for the loss in value as opposed to an actual re-sale loss.
Valuation evidence quoted in last week’s judgment priced the very same two bedroom apartment at a net market value of just $668,155.
“Based on the pricing of the stock remaining for sale and the current challenging market conditions prevailing, it is likely that the remaining apartments for sale in Tower 1 will require a future sales period in the order of 24 months,” presaged the valuer. “Moreover, I would generally expect the more expensive apartments to take longer to sell.”
The court ordered the delinquent buyers pay damages for the loss in value, plus the developer’s holding costs of nearly $200,000, total – after crediting the 10% deposit already paid by the buyers – $428,500.
The December valuation report was placed in a sealed envelope and an order made “not to be opened except by order of the Court or a Judge” and only a redacted copy of the valuer’s views has been included on the court file.
In further Oracle news, the eight defeated buyers who claim the developer had breached their sale contracts by re-branding the precinct under the name of Peppers hotel chain, have filed appeals that will be heard in coming months.
There are a further 12 or so contract fights pending in the Supreme Court. Some include third parties with Gold Coast real estate icons Ray White Broadbeach and Del La Parker being dragged into the fray, in one.