Frank
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One lender, Balanced Securities Limited, run by former top lawyer David Geer, appointed an external administrator to Qartaba in April, which had not paid back in full the mortgage it took out to borrow across four blocks of land in Tarneit, which have since been put up for sale by the creditor.
In 2018, Qartaba took out a $34.6m loan from Balanced Securities, with an interest rate of up to 19.95 per cent.
According to the Australian Securities & Investments Commission, creditors have securities on all of the two companies’ present and future properties. In some of those agreements, the companies borrowed in the millions each time, with one mortgage signed in late 2023 including up to a 26 per cent interest rate. In multiple sites, creditors have possessed mortgaged lands as the two companies failed to pay what they borrowed.
In May and June, at least 30 plots of Qartaba’s NSW land were sold at auction, many of which customers had signed and paid contracts on years prior.
Last week, the mortgagee also exercised its power of sale of Qartaba’s two sites across 149 and 161 Riverstone Rd, NSW, which sold for $5.6m and $2.65m respectively.
At the same auction, Qartaba’s 30 Kelly St, Austral, sold for $14.7m while its land at 2 John Oxley Ave was for sale at $2.5m.
In Victoria, 137 lots at Qartaba’s 120 Bodycoats Rd are up for sale, with one customer who purchased in mid-2018 saying they feared they could lose both their land and likely the money they put into it.
‘Complete loss’ Hundreds of customers have enlisted legal representation to help salvage what’s left, and those who sought retrospective financial advice have been met with damning news. One solicitor called Qartaba’s contracts the “most unsatisfactory” they’d seen, calling the documents “extremely unfair” and that the negative implications fell heavily onto the customer.
An accountant told a customer investments with Qartaba were a “complete loss at this stage”, while crisis meetings have been held with state and federal MPs.
In June, NSW Fair Trading Commissioner Natasha Mann said the watchdog was “concerned” about the issues being raised about Qartaba and was “making inquiries”. Dither and delay Sister company Hume Homes sold its off-the-plan contracts at 71 and 121-123 Boundary Rd, Box Hill, in southwest Sydney, between 2014 and 2016. At 121-123, a single lot cost about $150,000 for the land, and settlement should have been end-2019, but the land remains a patch of shrubbery.
A development application was submitted to Hills Shire Council in August 2016, approved two years later in mid-2018, before Hume Homes lodged a construction certificate application in November 2020, which was approved in June 2023. Council blamed the delay on planning issues by Hume Homes and said the same problems held up the next phase of the planning process.
The development cost per lot for customers was about $110,000, which was divided into monthly or quarterly interest-free payments. Any additional cost sought should have been paid on settlement.
But citing an “unusual increase in cost of living” in 2023, Hume Homes asked each customer to pay an additional $25,000 for unspecified “development charges”.
‘Negative propaganda’ The company has claimed it’s a victim of “unethical behaviour and negative propaganda” originating from WhatsApp groups.
Membership of those groups, however, are in the hundreds. All are customers, who Qartaba has blamed for approaching councils directly, claiming it has resulted in investors pulling funds.
“This negative campaign has affected our business resulting in lesser interest by investors (and) many pulling their investments,” a Qartaba statement claimed.
“Civil contractors and consultants working on our projects get alarmed. Some have ceased work on our projects and a few have refused to bid for (new) projects.”
The directors failed to respond to questions from The Australian.
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