Aqualand losses tighten with strong sales momentum

The Chinese developer’s flagship project in Central Barangaroo is now at the centre of political controversy and has been mired in significant delay.

Aqualand’s purchase of the valuable harbourside land parcel and allegations of secret dealings, which collapsed rival Grocon says helped the developer, has come in for scrutiny in NSW parliament. Picture: Richard Dobson

Aqualand, the Chinese-backed developer building the Central Barangaroo precinct on Sydney Harbour, posted a $32.9m loss for the 12 months to June 30, accounts filed with the regulator show.

Despite the poor performance, the result is an improvement on the $55.3m loss in the prior financial year, although that came after adjustments shrunk a $14.7m operating profit for the period.

The company’s flagship Central Barangaroo project is embroiled in parliamentary scrutiny and is significantly delayed.

Aqualand’s accounts show the company has been prioritising its harbourside play, obtaining a residual stock facility from PAG over unsold stock in its Revy 8 and Lavender Blue developments to finance Central Barangaroo.

Aqualand said the Central Barangaroo project incurred an additional cost of $9.2m during the financial year after the developer took on the lead role and secured development rights over the entire precinct in September 2019.

Aqualand’s purchase of the valuable harbourside land parcel and allegations of secret dealings, which collapsed rival Grocon says helped the developer, has come in for scrutiny in NSW parliament. It is currently examining decision-making around the precinct amid allegations Infrastructure NSW acted in favour of Aqualand, Crown Resorts and Lendlease.

Businessman Daniel Grollo, in his submission to the parliamentary inquiry, claimed Aqualand was “headed up by an enigmatic figure known to Grocon only as ‘the Chairman’ (formerly a high-ranking officer in the ChinesePeople’s Liberation Army) and his son, Jin Lin, who is now the group managing director”.

However, Aqualand’s Central Barangaroo project has itself suffered setbacks after NSW Planning Minister Anthony Roberts knocked back a proposal that would have expanded the size of its buildings in the precinct.

Elsewhere in Sydney, Aqualand is seeing strong sales at other luxury apartment projects in Pyrmont and North Sydney. It is also selling out of projects in Chatswood and Belmont. Aqualand sold a Baulkham Hills site for $102m and wrote off $16.1m relating to a project in Chatswood that did not go ahead. It bought a Pacific Highway property in Chatswood last November for $12.75m but has now struck a deal to sell it.

In September, Aqualand won the backing of listed real estate house Qualitas for a $600m funding package for its AURA luxury project in North Sydney. The company also has separate loans with Citibank and ANZ.

Aqualand said that despite making a loss it had achieved a net operating cash inflow of $323m, driven by the apartment settlements from the Lavender Blue and Revy 8 projects in the year. The developer is carrying $174m in inventory, noting it expected to sell most in the next 12 months.

The accounts disclosed the company has a related party loan of $540m from China‘s Shanghai Shenglong Investment Group expiring in June 2026.

Shanghai Shenglong Investment group renewed its $700m credit facility with Aqualand in a three year deal priced in at the bank swap rate plus 6.12 per cent.

Shenglong had committed to financially supporting Aqualand “as and when needed” to support its operations.