AU Big losses in Hilton's Boulevard Tower
Property Here - Thursday, September 05, 2013
Hilton Surfers Paradise Boulevard Tower. Source: Supplied
AN analysis of resales at the Hilton development shows apartment owners have been stung by massive losses - some by more than 40 per cent of the original purchase price.
The Hilton project was initiated by the failed Raptis Group which was taken over by financier ANZ, who appointed developer Brookfield Multiplex to finish the project.
It was completed in late 2011 and comprises the 32-level Boulevard Tower and the 57-level Orchid Tower sharing 410 units, with Orchid Tower also home to a 169-suite Hilton Hotel.
According to RP Data, since January last year 66 apartments have sold in the Boulevard Tower, with resales making up a small proportion of the total.
Unit 10504 was bought off the plan for $850,000 in February, 2008 and sold on May 30 this year for just $505,000, a 40.5 per cent drop in value.
In July this year, unit 10607 sold for $435,000, a 32 per cent dip in price from January, 2011 when a buyer paid $647,000.
A unit on the 21st floor was purchased for $910,000 in January, 2008 and sold in November last year for just $525,000.
Hilton Surfers Paradise Boulevard Source: Supplied
RP Data lists no resales for the Orchid Tower for the same period.
Colleen Coyne, of Colleen Coyne Property Research, said losses of 50 per cent in the post-GFC environment were not unusual.
"Since the GFC, when you include prestige areas like Mermaid Beach, I've seen anything as high as 50 per cent," she said.
"If it's 30 per cent they are doing well, which is a sad state of affairs."
REIQ Gold Coast zone chairman John Newlands said the project was a victim of a marketplace which had changed dramatically from when the development was conceived to when it was built.
"It's the result of the current marketplace," he said.
"Apartments have sold for below what it would have cost to replace them."
Mr Newlands said he expected prices to stabilise as the last of the "distressed stock" was sold.
In the past financial year there was $78 million worth of sales at the Hilton, according to 360 Project Marketing.
The average sale price was $780,000 with 107 apartments sold across the two towers.
There are fewer than five apartments left for sale in the Boulevard Tower and 10 in the Orchid Tower.
Prices start from $665,000 for the remaining units.
Read more: http://www.news.com.au/realestate/big-losses-in-hilton8217s-boulevard-tower/story-fncq3era-1226711346901#ixzz2evx3DPzx