The house of Salim Mehajer: rising from the ashes

Salim Mehajer’s mark on the world has been that of a poster boy for immoderacy.

Screengrab from a video Salim Mehajer made for his bride ahead of their wedding day.

When the father of Sydney’s flamboyant local councillor Salim Mehajer walked into a branch of the NAB in December 2008 with $2000 cash stuffed in a white envelope, he was a desperate man.

More than two decades after Mohamad Mehajer emigrated from Lebanon with his wife, Amil, the family’s property development business in western Sydney was on the verge of collapse.

It owed more than $4 million in overdue bank loans. Interest was accumulating fast, the ­Australian Taxation ­Office was closing in and the market for his apartments was evaporating amid the global financial crisis.

An application for a new loan — in which he stated his company’s profit for the year at $23,160 — had been rejected by the Bank of Queensland several months earlier.

GRAPHIC: Life in the fast lane

Now, having had a mortgage broker submit a false loan application inflating his company’s profit 30 times over at $752,300, he stood in the NAB banker’s ­office pleading for a $3m loan to keep him afloat.

“He (Mr Mehajer) kept ranting and raving about how I had to take the money and they shoved it in my pants pocket,” the staffer would later say of the white envelope, when questioned before the NSW Supreme Court. The loan was rejected and four weeks later liquidators were appointed to the company, with debts to the ATO of $700,000, which to this day remain unpaid.

Only about five weeks before the collapse, Mr Mehajer had removed himself and his wife as ­directors of their company, saying later he did not want a “black mark” against his name that would affect his ability to access loans.

It was a pattern that would be repeated several times in the years ahead as Mr Mehajer’s son, now the colourful Deputy Mayor of Sydney’s Auburn council, ­re-­established the family’s property development business.

Salim Mehajer, then 23, registered two companies to the same address his father’s failed businesses had operated from, at 1A Childs Street, Lidcombe, and took up work on a stalled property development at nearby John Street. He created SM Project Developments Pty Ltd in May 2008 and SM Engineering & Construction Pty Ltd three months later in Aug­ust, only months before the liquidators moved on his father’s company.

Salim Mehajer’s two companies would also collapse — and themselves owe the ATO an ­additional outstanding $1.1m — but, as previously, yet more new companies were formed.

The Mehajer family’s property development interests not only stayed afloat, they also appeared to flourish.

Through a byzantine network of 20-odd family companies founded from 2012, heavy with interconnected loans and common directors, Salim Mehajer has ­operated the group and banks ­appear to have been eager to lend.

While his father’s interests had been relatively modest — a handful of walk-up apartment blocks, individual homes and one key apartment complex on Lidcombe’s prominent John Street — now the son has in the pipeline four major complexes, spanning several city blocks and housing more than 600 apartments.

If his father’s business had been understated, Salim Mehajer’s mark on the world has been that of a poster boy for immoderacy.

His August wedding to Lebanese-styled beauty Aysha Mehajer — formerly beautician April Amelia Learmonth of Wollongong, on the NSW south coast — attracted not just teams of bikers but included fighter jet flyovers, several helicopters and an estimated $50m of supercars including Ferraris and Lamborghinis.

It also saw the unlawful closure of Lidcombe’s Francis Street, home to Salim Mehajer’s four-level mansion, which towers over neighbouring brick veneer houses in the otherwise nondescript suburban street.

The event attracted both police and media attention — not just for the Mehajers but also for Auburn council.

Moves by Salim Mehajer and fellow Auburn councillor Ronnie Oueik, also a property developer, to legally vote in favour of controversial changes to planning laws that favoured developers, had raised eyebrows for some time.

Following changes to the council’s Local Area Plan, both men altered existing development applications for their own projects, each seeking three or four additional levels to residential buildings, adding almost 100 apartments to each project.

While councillors are not permitted to vote on their own development applications, they are permitted to vote on issues such as broader changes to suburb-wide building height and density ­restrictions.

That situation angers two long-serving Auburn councillors, independent councillor Irene Simms and Labor councillor George Campbell, who are lobbying the NSW government to ban property developers from taking up local government positions.

Mr Mehajer’s lavish wedding — which also involved the creation of a pre-wedding “movie” of the couple where he is described as “the man who has everything” and in another scene is depicted firing a gun — drew concerns over the operations of Auburn council on to the national radar at a time when the Baird government in NSW is considering amalga­mating Sydney councils.

Before that media scrutiny, Mr Mehajer’s business activities had rung alarm bells with Dean Wilcocks Advisory principal Anthony Elkerton, the liquidator of his SM Project Developments.

As revealed by The Weekend Australian this week, Mr Elkerton is suing Salim Mehajer and his business partner for almost $700,000 on behalf of the ATO, over allegations the pair breached director’s duties.

That action follows a public examination of the men conducted by Mr Elkerton in the Federal Court last year.

It is understood corporate regulator the Australian Securities & Investments Commission is also looking into the business activities of Salim Mehajer.

Under corporations law, ASIC can ban people from being company directors for up to five years if they preside over the collapse of two or more companies within a seven-year period.

Aside from the two that collapsed, Salim Mehajer is listed as a director of at least eight of 20 companies currently operated by his family.

His property development group trades using several different names.

Despite widespread interest in his business activities, Auburn’s Deputy Mayor seems unfazed.

As he told News Corporation’s news.com.au on Thursday: “I ­belong nowhere else but on the front page.”