Finance company puts Tweed Coast development Salt Village into receivership

Finance company Capital Finance has pulled the pin on the luxury beachside development Salt Village on the Tweed Coast, forcing four companies owned by the Gold Coast property company Ray Group into receivership.

The $750 million development was a joint venture between collapsed property and financial services company MFS (since renamed Octaviar) and Ray Group, which is run by Tom Ray, son of the late Gold Coast developer Brian Ray.

But some doubts have emerged as to the reason for Capital Finance’s withdrawal from the project.

While Capital Finance has described its move as a “purely commercial decision”, the Ray Group has expressed shock at the decision.

“Salt Village has been and remains a good project,” Tom Ray said in a statement.

“The fact that the financier has withdrawn funding to the development assets would seem to us to have nothing to do with the project, but perhaps it has to do with the financier’s own issues and presumably a desire to repatriate funds from Australia.”

Ray also said the placing of the four companies in receivership – South Kingscliff Developments, Salt Developments, Kingscliff South and The Kingscliff South Discretionary Trust – would not impact the rest of the Ray family’s property empire.

According to a report in the Gold Coast Bulletin, the debts associated with the project are around $33 million. The Salt Village, which is to include 1,500 lots by completion, is understood to be 90% finished.

Accounting and insolvency firm Bentleys has been appointed as receivers. The receivers had no comment at this stage.