Sold out $140m Palm Beach tower Alegria canned, deposits returned after construction costs skyrocket

Buyers in a luxury tower development have had their deposits returned after developers canned the $140m project in the face of soaring costs. DETAILS:

Owners of a sold-out $140m tower at Palm Beach have dumped their plans and returned buyer deposits after suffering a multimillion-dollar cost blowout.

The 76 boutique apartments in beachfront Alegria sold swiftly after hitting the market a year ago, however buyers were told in May the project had been terminated.

Site works, including a new sea wall, had started in January with builder Condev, which subsequently went into administration with more than $45m in debt.

While a new builder was appointed to complete the job in the wake of Condev’s collapse, the Bulletin understands building costs for the tower ballooned as much as $10m since buyers signed up, with the bank subsequently withdrawing finance.

Alegria has been shelved.

Alegria’s owners, bus entrepreneur Joe Calabro and wife Roma, have lodged a $3.542 million proof of debt with Condev’s liquidators.

The project was being developed in partnership with Anthony Gordon and Paul Younan’s Daydream Property Development company.

The developers declined to comment.

The 3304sq m Alegria site, next to the Pacific Surf Life Saving Club, site was acquired from healthcare group Regis for $21 million in September 2020.

The project was designed by leading architects Cottee Parker and was due for completion by the end of 2023.

Initial criticism from the local community over its position so close to the beachfront didn’t stop the 76 luxury residences, including five premium beach houses, from being sold off-plan within three months of hitting the market.

The highest price achieved in the block was $6.5 million, which was for two of the beach houses which will be amalgamated into one residence, with the median price of the apartments landing at $2 million.

Alegria was one of six Gold Coast projects totalling $500m under way by Condev Construction when it collapsed.

Others included Homecorp’s $200m Capital Court towers at Varsity Lakes, SPG Land’s Brooke Residences at Robina, Spyre Group’s $77m Natura at Burleigh Heads, Macquarie York’s $76m Allure at Chevron Island and Marquee Development Partners’ Cannes One at Surfers Paradise.

Rising supply and labour costs, along with ongoing pandemic and weather impacts have seen major building companies go under in recent months, including ProBuild, Privium and Pivotal Homes.