Contracts “terminated” in Draycon Building’s Salt Palm Beach development amid “cost blowout”
A troubled developer, whose stalled Surfers Paradise tower has left scores of buyers in limbo, has terminated contracts on another Gold Coast project. Read the details
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A developer whose stalled Surfers Paradise tower has left scores of buyers in limbo - and fearing contract cancellations - has terminated contracts on another Gold Coast project.
Sydney builder-developer Draycon killed contracts for its Salt Palm Beach project in March, with its selling agent saying it could not be built due to construction cost blowouts.
Development of 22 two-bedroom units was approved for a 754 sqm site in August 2019.
Draycon managing director Howard Dabit did not respond to questions from the Gold Coast Bulletin.
Property records show a company named DEEA, which has Luna Dabit as sole director and shareholder, bought the Palm Beach land for $1.9 million in December 2020.
An old 1950s-era home has since been demolished, but construction is yet to commence.
The site remained quiet but active this week, with a handful of workers there with earthmoving equipment and a shipping container and a Draycon construction sign out the front.
The project was being marketed by Sutherland Property Group, which also handled the campaigns for Draycon developments at Southport and Chevron Island.
Managing director Julian Sutherland said “Salt was withdrawn from sale a long time ago”.
He declined to comment further but, in an email to a buyer in Draycon’s Chevron Island project Boutique, confirmed contracts for Salt had been cancelled.
“(The developer) has terminated all contracts in Salt Palm Beach as he is unable to build this project due to blowouts in construction costs,” the email said.
Posts on Sutherland’s social media were promoting the project as recently October last year, while a stand-alone Salt Palm Beach website remained accessible until the Gold Coast Bulletin queried it on Thursday.
The apartments have been advertised at prices between $800,000 and $1.4 million.
Buyers in Draycon’s Boutique project at Chevron Island in Surfers Paradise fear their contracts will be cancelled after work stopped earlier this year.
Buyers in the 42-unit project said their lives had been on hold for three years and now worry the developer will use sunset clauses to cancel their contracts and resell the apartments for higher prices.
Meanwhile, developer Heran Group has refused to rule out invoking sunset clauses on 119 apartments in Midwater Main Beach, which are potentially worth $100 million or more above the value when contracts were signed.
Also at Main Beach, developer Andrews Group invoked the sunset clause for some multi million-dollar contracts in its ultra-luxury Dune project.
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Originally published as Contracts “terminated” in Draycon Building’s Salt Palm Beach development amid “cost blowout”
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