Tourism downturn hits Hervey Bay property sales

Brisbane-based Affinity Property Group, the company behind the Ramada Resort Hervey Bay on Queensland's Fraser Coast, has collapsed.

Ron Dean-Willcocks, of Dean-Willcocks Shepard Recovery & Strategy, has been appointed voluntary administrator.

Tim Wright, chairman of Affinity, says the Ramada Resort is going “very well” despite “hard times” for tourism. The resort was completed in 2009.

Wright says Affinity had failed to sell 20 of 46 apartments within Ramada. The apartments were put on the market at the end of last year, after the sales process was put on hold during the GFC.

“If all the apartments had been sold off, we wouldn’t have had the same problem,” Wright says.

The two-bedroom apartments were originally offered for $400,000. Wright says the prices were reduced, but not substantially.

Wright says he is confident a buyer can be found. “We’re trying to work out the situation in the best possible way,” he says.

Affinity Capital purchased the Ramada licence in 2007 and developed the first stage of the Hervey Bay resort. Seascape Capital and Seascape Property, behind the second stage of development, were also chaired by Wright.

A Seascape Capital fact sheet says: "We believe there is no better time to develop than now. We have an ideal location in one of the fastest-growing cities in Australia with a global brand name: Ramada.”

"[There] is no better time to build than now as the construction companies are pricing very competitively.

"Furthermore, as a lot of construction elsewhere has slowed down (as well as development approvals), we believe that we will have apartments on the market at the ideal time to take advantage of the next property cycle."

A meeting of creditors will be held on July 1.

The administrators could not be contacted this morning.

This article originally appeared on SmartCompany.