Investment Updates: April 2025

The borrower continues to work towards the refinance of the facility.

Construction is now complete, and the Statement of Compliance has been received which marks the final milestone required for the issuance of titles. Titles are anticipated in early May, with the first round of settlements to follow shortly after.

Tatura:

– Stage 2 settlements continue to be delayed due to council. Settlements are expected to commence towards the end of next month at the earliest.

Morwell:

The facility expired on 7 March 2025. ARK has reserved its rights to put the borrower into default while a new facility is arranged.

In December 2024, it was confirmed that the Ballarat North PSP will exclude the Expanded Area where the property is located.

An updated valuation report for the property has now been finalised, with ARK addressing the reduced value internally. Discussions with the borrower are scheduled for next month to develop a strategy to maintain compliance with the facility’s debt covenants.

The borrower plans to hold the two remaining security properties as a land bank while due diligence on the Oakbank PSP continues. ARK intends to refinance the existing facility into a new 12-month facility in June 2026.

The borrower intends to strategically hold the property in the short to medium term whilst continuing to monitor the market. The planning overlay remains supportive of a major mixed use development on the site.

To date, 4 out of the 8 residual lots from Sellicks Beach have been sold and settled, reducing the facility LVR from 70% to 68%.

One of the Sellicks Beach lots is expected to be subdivided into two in order to maximise the total proceeds, this has been approved by ARK.

Insurance and demolition works have commenced on the Buckingham Arms site to prepare it for future development, with 95% of the site now cleared and works continuing to address any remaining fire damage to the existing property.

A 3-month extension to the facility has been provided until the end of May 25 to provide additional time for the completion of remaining works due to delays from to inclement weather and council.

Installation of the stormwater drain occurred during the month. Practical completion of the civil works is expected to be achieved in May-25.

Stage 4 settlements have commenced this month, with 43 of the 56 total sales completed.

Bulk earthworks for Stages 5 to 7 are underway and are expected to conclude by the end of 2025. Civil works for Stages 5 and 6 are now scheduled to commence concurrently in May 2025, with Stage 7 following a month later.

The facility has now been refinanced into a construction facility. The borrower expects to appoint a civil contractor by the end of next month which will enable works to commence shortly thereafter.

The Stage 1 construction facility has been refinanced into a 12-month residual stock loan. The borrower intends to sell the remaining lots over the term to progressively repay the facility.

Road and drainage works are continuing within Stage 2 whilst the sewer reticulation works are now complete.

The Stage 3 construction facility reached financial close during the month.

An EOI campaign with Savills received offers ranging from $20 million to $28 million with varying structures.

To allow the borrower to consider each of these offers (all of which exceed the valuation), ARK has provided a facility extension until 31 July 2025.

The borrower has successfully finalised and executed the civil works contract. Construction is anticipated to commence on-site in early May.

The borrower submitted the planning application for the proposed 213-lot subdivision in early January with preliminary council feedback expected in the coming months.

Civil works are progressing well with over 60% of the contracted works complete to date. Precast walls have been installed for 18 warehouses out of 24 lots and roof sheeting completed for 15 warehouses.

Sales performance remains strong, with a recent transaction bringing the total number of secured sales to seven.

The borrower is actively engaging with civil contractors ahead of a formal tender process to finalise the construction contract price. ARK has also begun preliminary discussions regarding a potential construction facility.

Remediation works are now four weeks into the scheduled eight-week program. Due to a minor delay in commencement, the extent of remediation required on site will be confirmed in the first week of May. Current forecasts indicate remediation will be completed by June 2025, with civil works to follow.

The civil tender is in its final design phase with the preferred contractor and is expected to be finalised in May 2025.

The borrower has received approval, with modifications, for the amendment to the Local Structure Plan. The final application is expected to be submitted shortly, with planning approval anticipated in June and subdivision approval expected in July.

The borrower is continuing discussions with major banks to secure a refinance, which is expected to accelerate as the facility term approaches maturity.

Mobilisation works are now largely complete, with internal construction access routes established, construction fencing in place, and the site compound fully set up. The project team has obtained all necessary approvals for the commencement bulk earthworks. Due to the holiday period, bulk earthworks are set to commence at full capacity from the start of next month.

Works on site continue to progress despite some inclement weather.

Works onsite this month include:
• Bulk earthworks
• Sewer works
• Completion of the electrical services relocation
• NBN works