Dunk Island developer vows to push on
The founder of the collapsed investment house Mayfair 101, James Mawhinney, vows his ambitious plans to redevelop Dunk Island, along with much of the North Queensland’s Mission Beach, will proceed thanks to a new group of investors.
“We will get it done,” Mawhinney told The Australian, adding he is going through the final stages of getting the funding organised.
Mawhinney said he has brought on board a group of local high net worth investors to restart the project. However he would not reveal their identities nor the amount of money they planned to plough into the project.
Mayfair’s hopes of transforming Dunk Island into a $1.5bn tourism mecca were dealt a heavy blow in mid-August when the Federal Court appointed Grant Thornton as provisional liquidators of key parts of its empire.
During the hearing the Australian Securities and Investments Commission which told the Federal Court that Mayfair may have been running a Ponzi scheme and Mr Mawhinney was asked to surrender his passport as he could face criminal charges.
Mawhinney at the time told the court he was “happy to surrender his passport to the court” and made a similar offer to ASIC.
Mayfair 101’s plan is to purchase hundreds of residential homes and housing lots in Mission Beach about two hours south of Cairns and redevelop Dunk Island which Mr Mawhinney says needs a further $300m to $400m in infrastructure work.
“We are going through the final stages of getting the funding organised,” Mawhinney said.
He denied there had been any hold up of the project and that the group of white knight high net worth individuals had “come in very recently”.
“They have seen the vision, they love it and want to be part of it,” he said.
He said funding was on track to arrive by the end of September, adding that the most immediate financial need was resolving the receivership issue on the mainland with Mayfair 101’s financier Naplend, as well as resolving the issue with the Bond family over the purchase of Dunk Island, which had been ongoing for more than a year.
But the plans face obstacles with Naplend calling in McGrathNicol as receivers to recover its loan exposure after the court judgment. The lender said at the time it had granted Mayfair multiple extensions, although if the developer could refinance it then McGrathNicol may be retired.
ASIC has grounded Mayfair 101 founder James Mawhinney with a passport freeze. Picture: Supplied.
The Bond family also took control of Dunk Island resort last week and although it is yet to appoint an agent the market has been touted for sale.
Mawhinney would not disclose how much additional funding he required for the whole project.
“We expect to recommence the Dunk Island Spit redevelopment and the refinancing of about 120 properties in Mission Beach that is around $50m worth of real estate on the mainland.”
Mawhinney said that if the funding does not eventuate there were a number of different parties interested.
“We have a plan B and a plan C in place. We are very committed to the Bond family — we speak to them every day.
“It has taken some time given the COVID-19 environment and the impact on our business, these things take a long time when you are dealing with these large amounts of money both the Bond family and Mayfair 101 are keen to see this project through together.”
Mayfair 101 started negotiating to buy Dunk Island in June last year.
“We have spent close to $100m in the region overall including some of the purchases of the houses and part of the redevelopment of Dunk Island.”
Local Mission Beach agent Steve Wiltshire is waiting for the settlement of about 20 residential houses in the area which Mayfair 101 has contracted to purchase through his Mission Beach Real Estate agency.
Other Mission Beach agents – which are also exposed to Mayfair 101 – declined to comment to The Australian.
Two Mayfair products raised about $140m from investors. The corporate regulator told the court that the M+ Fixed Income Notes had 185 investors who invested about $72.96m. Mayfair’s M Core Fixed Income Notes were backed by 96 investors who had invested $67.59m.
This article originally appeared on www.theaustralian.com.au/property.
