Morwell:

•  Civil works on Stages 1–3 have now commenced. Winslow’s latest forecast anticipates PC for Stages 1 & 2 by Q1 2026, and Stage 3 by July 2026.
• Presales achieved to date include 50 lots across Stages 1–3, with a further 9 in Stage 4.
• Presales are progressing well, with 50 across Stages 1–3 and 9 in Stage 4. Marketing has resumed, generating strong early enquiries on remaining stock.
• The Australian Government’s Housing Support Program has allocated $7.9 million for sewer infrastructure benefiting the property.

The facility is currently in default, with ARK reserving its rights from the facility expiry, 7 March 2025 to charge default interest until an appropriate resolution or exit is reached with the Borrower.

Following the property’s exclusion from the Ballarat North PSP in December 2024, a valuation was completed, with a secondary valuer subsequently confirming the same reduced value.

ARK continues to explore options to maintain covenant compliance and protect investor interests. The sponsor is working towards providing a final position, after which the necessary changes will be implemented.

Discussions with the borrower remain constructive, and ARK is confident of achieving an outcome aligned with investor interests.

The borrower continues to hold the properties as a land bank. The due diligence period on the Oakbank PSP has been completed.

The VPA has submitted the 2025/2026 business plan to the Minister for Planning which includes prioritisation of Horizon 2 PSPs. There is potential for the Oakbank PSP to be included in the business plan, while no official timeframe for approval has been provided.

The extension of the facility is on track to be finalised prior to the current maturity date.

At Sellicks Beach, 4 of the 8 remaining residential lots are still available, with one set to be subdivided into two, projecting a 25% premium over the most recent valuation. In addition, one commercial lot has been contracted above its valuation, with settlement still on track to occur in late September 2025.

At The Buckingham, work on the future build continues to advance.

Project Update:

• Practical completion of civil works is now forecast for early September 2025, subject to no further major weather interruptions.
• Council has approved the 4.55 modification, enabling the separation of the two DAs (land civils and marina).
• The Marina DA was formally approved at the S.34 Conference on 19 August 2025, representing a major milestone for the project.

Sales:

• The sponsor remains confident of securing a sale, with a signed sales advice received and contract exchange now expected in early September 2025, following resolution of final points.

Strategy:

• ARK is actively negotiating an extension of the facility through to October 2025.
• This extension will provide sufficient time to achieve clarity on sales activity and subdivision title issuance. At that point, a refinance will be considered, either via a new facility with ARK or through another lender.

The civil contractor has now mobilised on site which will enable works to accelerate over the coming month.

A large number of Stage 2 lots settled this month, which has significantly reduced the facility balance.

The Stage 2 construction facility is expected to be refinanced, along with the existing Stage 1 residual stock facility, into a new combined Stage 1 and 2 residual stock facility in late September or early October 2025.

Stage 3 works continue to progress as expected and remain slightly ahead of schedule.

Civil works continue to progress well, with 94% of contracted works now complete. Windows and doors installation is well underway, bathroom fitouts are significantly advanced, and the majority of warehouse floor slabs have been poured.

Council has approved the amended structure plan, and subdivision approval has also been secured. The sponsor has subsequently obtained an updated valuation reflecting a significant uplift in value.

The facility has been extended by 60 days to allow the borrower time to finalise the preferred facility structure, with construction anticipated to commence in November.

The facility was extended during the month for a further three months to align with the completion of renovation works.

Works on site have been progressing strongly, and the civil contractor has deployed significant additional machinery to accelerate the construction program. To date, bulk earthworks are approximately 30% complete.

Construction continues to progress including the following:

• Bulk earthworks nearing completion
• Sewer works are complete
• Internal stormwater is nearing completion
• Retaining walls are complete
• External road subbase grade complete

Titles for Stage 1 are expected to be issued in October with settlements to commence in November.

The sponsor has sold 56 out of the 70 lots, however, only 41 of these have been recognised as qualifying presales, as the remaining contracts either fall outside the required sunset dates or do not have a 10% land deposit paid.

• Construction of Level 4 has been completed and fully fitted out, with ongoing inspections by prospective purchasers.
• Level 5 is approaching practical completion, with carpet installation scheduled for the first week of August. The Certificate of Occupancy is expected in late August. There have been minor delays to some finishing works.

Hotel Component:

• Practical completion is expected in early September. The sponsor has a buyer that is wanting to operate the hotel component itself not including the food and beverage area which has primarily caused the delay in completion due to the change in plans.
• The food and beverage area has been leased to an external operator and as it is held on a separate title from the hotel, is planned to be sold.

Sales & Settlement Update:

• The sponsor has successfully sold 2 of the level 5 Sky Loft apartments above valuation.
• The West Lakes property remains on track to settle in October 2025.

The facility reached financial close during the month.

The facility reached financial close during the month.

The facility reached financial close during the month.