House prices hold up in Mayfair 101 fire sale of Mission Beach properties

The receivers of the collapsed Mayfair 101 investment group have so far sold off 36 houses in the Far North Queensland coastal village of Mission Beach at a small loss.

Mayfair 101 founder James Mawhinney. Picture: Ally Lombardo

The receivers of the collapsed Mayfair 101 investment group have sold off 36 houses in the Far North Queensland village of Mission Beach at just below the original purchase price.

Mayfair 101 founder James Mawhinney, who has been banned from promoting and raising funds by the Federal Court for 20 years following proceedings brought by ASIC last year, says the 1.2 per cent loss justified Mayfair 101’s purchasing prices over the past few years.

Mr Mawhinney had plans to develop a $1.5bn resort community at Mission Beach, south of Cairns, which also included the purchase of Dunk Island just off the mainland.

Despite the boom in regional property prices, Mr Mawhinney argues that the sale prices of the properties – sold under fire-sale conditions in the remote location – justified the prices Mayfair 101 paid when it started purchasing the properties two year’s ago.

“It shows Mayfair’s buying was spot-on, having paid just 1.2 per cent more than what the receivers sold them for,” Mr Mawhinney said.

“A loss of just $188,045 was made on a $15m portfolio in a receivers sale.

“This confirms there was real value and significant value in the security underpinning Mayfair’s noteholders.”

All up, Mayfair 101 contracted to purchase 230 properties in late 2019 and settled 130 of them via bridging finance through an arm of the Palan family office associated with Freedom Furniture.

However, Mayfair 101 halted redemptions to its unitholders around March 2020 and ASIC sought court orders a month later to stop it raising more funds.

Questioned about any losses, Mr Mawhinney said the introduction of receivers’ sale signs throughout Mission Beach had left a “pretty bad stigma” on the region, which meant optimal prices weren’t maintained.

One property at Porter Promenade sold at a $20,000 loss, while another in Bingil Bay sold at a $200,000 loss. The properties sold for an average price of $412,867 compared with Mayfair’s acquisition price of $418,091.