Finbar cautious on Hedland site
Finbar has negotiated a clause into its contract to buy an oceanfront apartment site in Port Hedland allowing it to call off the $390 million project if sufficient pre-sales are not achieved.
The apartment developer said it had reached an agreement with LandCorp to pay $5.95 million for the former Port Hedland Hospital site, a 3.15ha parcel of land overlooking the proposed Spoilbank Marina.
Finbar said around 518 residential apartments, 163 short stay apartments and 2300sqm of street activated commercial lots in eight to 10 level buildings could be built at the site but only if the project meets marketing success,
"Our final negotiated position allows our company to seek development approval, and proceed to settle and develop the land only if we can achieve pre-sales that suitably de-risk and underpin the land purchase and project viability," said Finbar managing director Darren Pateman.
Poor apartment sales in a landmark complex in Karratha left Finbar holding rented apartments in its portfolio.
In a statement Finbar said it would seek development approval for the first stage of the four stage development and would aim to start marketing in the second half.
In stage one there would be 109 one and two-bedroom apartments along with five commercial tenancies and a café fronting Sutherland Street and the oceanfront.
Subject to market conditions, a further three stages would follow comprising an additional 441 permanent residential apartments, 163 short stay apartments, plus 1646sqm of commercial space.
Mr Pateman said the current economy in Port Hedland presented an opportunity for Finbar to participate in a market absent of competition and create a preferred destination for Port Hedland residents to call home while providing the community with more business and tourism options.
Mr Pateman said Finbar's 300 apartment Pelago Project in Karratha had demonstrated its capability in undertaking a leadership role in providing lifestyle apartment accommodation in the North West and responding to community desires.
"Undoubtedly, we are operating in a different economic and market environment to when we first looked at the project," he said.
"However, with the benefit of a market acceptance clause and an attractive purchase price, we will be able to offer affordable one and two bedroom product to a local community that has been supportive of the project concept and still has a core need for convenient, well located, low maintenance accommodation for the local residents and service providers' operational workforce."
Finbar shares were off half a cent to $1.295 at 10.35am.
