Gold Coast property developer Raptis Group on the brink

Listed property group Raptis has suspended trading in its shares after one of its divisions was put into receivership.

Listed property group Raptis has suspended trading in its shares after one of its divisions was put into receivership.

Raptis Group arm Limdaning, which was developing the third tower of Raptis’s $700 million Southport Central development on the Gold Coast, was placed in receivership by lender Capital Finance Australia after it failed to pay subcontractors.

Raptis said in a statement last night that it will work with receivers KordaMentha to ensure the best outcome for shareholders, sub-contractors, staff and buyers.

The future of the wider group now looks dicey. The company, which owes almost $770 million, is desperately trying to sell assets – including the Gold Coast International and Sheraton Mirage hotels – in a bid for get funding to continue developments, including its flagship Hilton Hotel project.

Chief executive and founder Jim Raptis told news.com.au that the company was battling to stay afloat. “We are trying our best. It’s a day-by-day and week-by-week scenario.”

Like most property developers, Raptis has been hit hard by the credit crunch. “We have never come this close before. We have been through the ups and downs and the difficulties,” he told The Australian Financial Review.

“These are extraordinary times. It is harder to borrow $5 million today that it was to borrow $100 million last year.”

Raptis Group lenders include Suncorp, ANZ, St George, NAB and Investec Australia. ANZ is the primary lender to Raptis Group’s Hilton development.

This is not the first time Jim Raptis has been close to collapse. In 1993, Raptis Group was placed in administration with debts of $70 million. But as the Queensland property market boomed over the last decade, Raptis was able to rebuild his empire.

Raptis’s woes comes only a day after administrators were appointed at Queensland finance and property group Asset Loans Group. Gold Coast companies MFS and City Pacific are also under severe pressure as a result of the credit crunch.

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• Credit crunch claims Queensland finance company Asset Loans Group