Gold Coast Business: Rift between co-owners of Robina’s Rocket tower

AN explosive rift has developed between the co-owners of one of the Gold Coast’s biggest office towers.

The Rocket

AN explosive rift has developed between the co-owners of one of the Gold Coast’s biggest office towers.

It comes as Sentinel Property Group, a half-share owner of the $70 million Rocket building in Robina, has been ordered to pay costs to fellow Rocket co-owner Clarence Property Group after losing a bitter 23-month legal stoush.

Clarence Property’s managing director Peter Fahey is claiming a victory against its business partner but Sentinel managing director Warren Ebert sees its differently.

Sentinel and Ballina-based company Clarence purchased The Rocket from Robina Projects

The tower at Robina Photo: David Clark

Australia for $70.05 million in September, 2015.

The dispute between the co-owners began in February, 2017 when Clarence employed Sentinel’s building manager for the Rocket, Simon Kennedy. Also, Sentinel was advised the following month that it had appointed Robina Group director Tony Tippett to its board.

Mr Ebert told the Bulletin that Sentinel intended to hang on to its half-share of the Rocket despite the dispute.

“(But) I can tell you I will not be sending any Christmas cards (to Clarence),” he said.

Mr Ebert said Clarence had showed its “true colours”.

“I’m not at all happy. That fellow (Mr Kennedy) worked for us and they say they did not steal him from us.”

The Rocket office tower at Robina

He said Sentinel remained the bigger fund with $1.25 billion worth of assets in its portfolio.

“Clarence has been going for longer and only has a quarter of what we have.”

In the first of three cases related to the stoush, beginning in the Supreme Court at Brisbane in November, 2017, Sentinel alleged Clarence failed to act in good faith when it hired Mr Kennedy and appointed Mr Tippett to its board without advising Mr Ebert.

The fund claimed as a result Clarence was in breach of the co-owners agreement and therefore was obligated to transfer its half-share of the Rocket to Sentinel.

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Clarence Property managing director Peter Fahey

Sentinel also alleged there was a conflict of interest stemming from Mr Tippett’s interests in both Clarence Property and Robina while a rental guarantee dispute, involving Robina Group allegedly owing close to $500,000 to both Rocket co-owners, was being resolved.

A judgment, delivered by Justice David Jackson in the Supreme Court of Brisbane last year, said Knight Frank Gold Coast partner Tania Moore met Mr Kennedy in February, 2017, to gauge his interest in a position at Clarence.

Mr Kennedy joined the Ballina-based fund the following month, prompting Mr Ebert to allege that he had been poached “secretly” because it had not been disclosed by Clarence to Sentinel.

Tania Moore, of Knight Frank, with Clarence Property Group's Peter Fahey

In addition, Sentinel claimed Mr Tippett’s Robina Group directorship and financial interests meant his companies, which owned the nearby Robina Professional Centre, could potentially be in competition with the Rocket co-owners for tenants.

However, Justice Jackson found that legally the potential competition did not prevent him from being involved with both companies. He also found Clarence was under no obligation to disclose its appointment of Mr Tippett to its board, agreeing that it was “none of Sentinel’s business”.

Regarding the rental guarantee dispute, Justice Jackson said Mr Tippett had no role in

Sentinel Property Group, managing director, Warren Ebert.

Clarence Property’s Peter Fahey agreeing to a settlement figure.

Justice Jackson said Mr Kennedy was perfectly entitled to find employment with Clarence and not to tell Sentinel he was intending to leave.

He said while Mr Kennedy leaving may effect the co-owners’ business, it did not come under the purview of the co-owners agreement.

In May last year, Justice Jackson found in favour of Clarence, stating it had not breached the agreement between the parties.

In November an appeal was dismissed and this week costs were awarded to Clarence.