Bankrupt Phil Sullivan linked to $15.5m mortgage to Broadbeach Mark Howard development

A company directed by a twice-bankrupt retiree, who was ordered to pay more than $70 million to creditors of a $1 billion failed investment firm, chipped in for a $15.5 million loan for a luxury Broadbeach apartment development, mortgage documents have revealed.

A COMPANY directed by twice bankrupt retiree Phil Sullivan, who was ordered to pay more than $70 million to creditors of his failed investment firm, chipped in for a $15.5 million loan for a luxury Broadbeach apartment development, mortgage documents have revealed.

In January 2016, after a Federal Court judge ordered Mr Sullivan and three colleagues to pay back more than 11,000 investors in the disastrous Pacific First Mortgage Fund, Mr Sullivan said he had no assets or insurance to cover any potential payout. “I’ve got nothing left,’’ he said at the time.

Nine months later, mortgage documents show a company he directed, DCG Development Capital, jointly loaned $15.5 million to a company owned by fellow failed GFC developer Mark Howard.

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The Howard Group development at 19 Broadbeach Boulevard.

The funds were tied to Mr Howard’s 19 Broadbeach Avenue development, which is now embroiled in a dispute that’s left at least 20 subcontractors about $3 million out of pocket.

Howard Group’s builder, TPD Builders, has launched court action against three Howard-linked companies, claiming it had not been adequately paid.

Subcontractors of the builder, mostly small and medium businesses are owed more than $3 million for the Howard Group work.

TPD’s sole director, Aaron Thompson, declined to comment on the case while it’s before court.

Mr Howard said he had paid the builder what he owed.

Public records showed DCG Development Capital, of which Mr Sullivan was a director until February this year, was still a mortgagee of the property yesterday.

The company is now directed by 45-year-old Dee Sullivan.

Former City Pacific CEO Phil Sullivan outside his company headquarters at Broadbeach before the company failed.

Yesterday Mr Sullivan said he understood DCG’s mortgage for the Broadbeach property had been paid out.

“I’m not a director of the company anymore and I don’t have anything to do with it,” he said.

“But I understand it has been paid out. The builder was paid, as far as I’m aware, was paid directly by DCG on every account that was submitted.

“What happened between the builder and developer, I have no idea.”

Mr Sullivan then asked to be quoted as “a spokesman for DCG Capital” and hung up after the request was refused.

Mr Sullivan was declared bankrupt in July after a decade of court battle over the collapse of City Pacific, which, at its peak, had a market capitalisation of nearly $1 billion.

His own personal wealth was once valued at more than $300 million, making him one of Queensland’s richest men.

The fund, with 11,000 unit holders — many of them elderly investors looking for retirement income — loaned millions to property developments on the Gold Coast including Mariner’s Cove and the Surfers Paradise site where Jewel is being built.

It collapsed in 2009 in the wake of the Global Financial Crisis, shortly after funds management company Balmain Trilogy wrested control from City Pacific.