The developer of a proposed hospitality training school at Kangaroo Bay has expressed doubts over the hotel component

The financial viability of a hotel at a multimillion-dollar hospitality school development has been called into question.

An artist’s impression of the proposed Kangaroo Bay development. Picture: Circa Morris-Nunn

THE hotel component of the multimillion-dollar Kangaroo Bay development could be significantly delayed as the builder contemplates seeking new permits.

Despite saying he was “feeling confident” about the project in a media release on Monday, Clarence Mayor Doug Chipman’s report on his recent China visit indicated the developer may divide construction into two stages.

The report, tabled at a council meeting on Monday, also showed the Chinese-based developer Shandong Chambroad had questioned the financial viability of the hotel.

Australia: Delegation from Tasmania's City of Clarence led by mayor Doug Chipman visits Chambroad Holdings in Binzhou City 滨州市 11 June 2019https://t.co/K6XguXn2AB pic.twitter.com/Iv8TQGdjGR

— Geoff Wade (@geoff_p_wade) June 16, 2019

Alderman Chipman said Chambroad had estimated the hotel could now cost as much as $80 million to build — up from what was initially a $50 million facility.

Chambroad has already spent $9 million on the project, while Clarence City Council has spent $15 million on improvements to Kangaroo Bay.

“Chambroad’s point of view … strongly implied a new development application would be required to accommodate up to 150 students at any one time — current approvals have 105,” Ald Chipman wrote.

“[A Chambroad representative] suggested the hotel itself should become stage two of the project, possibly with a significant delay.”

MORE:

CLARENCE COUNCIL THREATENS BUY BACK OPTION

DOUBTS CAST OVER KANGAROO BAY DEVELOPMENT

TASTAFE PULLS OUT OF KANGAROO BAY PROPOSAL

Ald Chipman said he told the company any further delay seeking new permits “would jeopardise the prospect of substantial development before November”.

The council has threatened to buy back the valuable waterfront land if substantial progress is not made within six months.

The hospitality training school and hotel development has so far been delayed due to the wait for an educational provider to commit to the project.

Clarence Mayor Doug Chipman. Picture: SAM ROSEWARNE.

Chambroad is keen to explore options with the University of Tasmania which has expressed interest in being part of the facility, with representatives of the Chinese company set to visit Tasmania next week.

“We are looking forward to next week’s visit by representatives from Shandong Chambroad and furthering discussions with them about the Kangaroo Bay development,” University Vice-Chancellor Professor Rufus Black said.

Clarence Ald Richard James said the project may not proceed if an educational provider doesn’t come forward and sign up.

Cr Tony Mulder said it seemed the Mayor had learned nothing on the China trip he didn’t know before.

But in the media release Ald Chipman said he had “constructive discussions” with Chambroad’s senior representatives, including chairman Ma Yunsheng.

“All parties have confirmed a strong commitment to this project and we are feeling confident about the development of the important Kangaroo Bay precinct,” he said.

[e-mail]