Iconic Dunk Island could close if an investor is not found to fund cyclone rebuild

Two resorts off the Queensland coast battered by Cyclone Yasi could close if a buyer or investor does not emerge, its operator says.

The resorts, at Dunk and Bedarra Islands, are off Mission Beach, which is 140 kilometres south of Cairns. Operator Hideaway Resorts says an April 2012 deadline for reopening will not be met.

Hideaway Resorts, which is owned by Pamoja Capital and its two directors Rupert Greenhough and Andrew Menzies, says it has “exhausted all avenues of Government support for a rebuild” after assessing the extent of the damage from Cyclone Yasi this February.

“Unfortunately, after reviewing all relevant factors the current owners of the resorts have determined they are not in a position on their own to commence a full-scale redevelopment at Dunk or Bedarra Islands,” Hideway Resorts CEO Mark Campbell said in a statement.

“Dunk and Bedarra Island resorts have been part of the Australian and Queensland tourism for many years and this decision has not been taken lightly.”

“We understand it will have significant impacts for our staff and patrons, and more broadly for the tourism industry of Missions Beach and tropical North Queensland.”

Hideaway says it is appointing a hospitality real estate advisor to help secure expressions of interest.

A spokesman for Hideaway Resorts said the operator was understood to have 150 employees across the two islands. A revenue figure for the business was not given.

Peter O’Reilly, of Tourism Whitsundays, says Dunk has been an “iconic island product for a very long time” and is “well recognised for its incredible branding.”

“They played an important role in Queensland’s tourism development,” O’Reilly says.

Nonetheless, O’Reilly says the announcement is not surprising given the difficulties of getting a good return on investments and the damage inflicted by Cyclone Yasi.

“With Dunk, the buildings largely have been levelled, it’s an enormous rebuilding effort,” O’Reilly says.

“It’ll obviously be a lot of work to rebuild.”

He adds that Hideaway Resorts’ public comments might well trigger different kinds of cashed-up investors to come forward.

“We’ve seen of late people who have invested in resorts and they’ve been non-traditional non-tourism people, such as Clive Palmer, so they might be looking to find a friendly billionaire.”

Cassowary Coast Mayor Bill Shannon told The Australian the resorts were “vitally important – they’re the mainstay of Mission Beach.”

“The region is still doing it pretty tough, but we’ll get through it. There are tradesmen everywhere at the moment (rebuilding) and the caravan parks are virtually full of grey nomads.”