Luxury resort’s future hangs on vital decision
A LUXURY resort's future hangs on whether the developers can secure an extra four years to lock down a $100 million investment, a five-star operator and get the project off the ground.
Badderam Eco Luxe Resort and Spa proponents Heidi Meyer and Kim Carroll have requested their development approval be extended to six years instead of two as they continue the search for a capital investor.
They claim 11 "recognised, luxury, international management groups" have expressed interest in their project, but said any further details were treated as commercial in confidence until a management agreement was signed.
The pair recently engaged the help of Savills Hotels to help "reach a broader audience", and proposed a number of alternative development benchmarks in a revised Infrastructure Agreement as part of their submissions before Sunshine Coast Council.
The Buderim project is proposed to be built across a 4ha site on Box St, Buderim, and is aimed at high-end international markets.
It would include a 111-suite resort and restaurants on vacant land with views to the Glass House Mountains.
Council granted the project heavily-conditioned development approval in April last year, which required the proponents enter into a Hotel Management Agreement (HMA) within two years.
Ms Meyer suggested if their extension request was denied it could signal the end of Badderam.
"I think the greater question is, what will it mean for the Sunshine Coast if the extension is denied, rather than the 'project'?," Ms Meyer said.
"The region misses out on not only construction but long-term jobs, and a much needed new tourism infrastructure for the region, capable of attracting and impressing international visitors coming through our new international airport.
"The region misses out on a new high-value, luxury and sustainable tourism asset."
Ms Meyer said a six-year development approval would be in line with luxury resorts Sekisui in Yaroomba and Aria on Mooloolaba Esplanade, which were given the green light shortly after Badderam.
Savills Hotels director Max Cooper wrote to council in support of Badderam's request, and rejected council's recent advice that two years was "ample time" to enter into a HMA.
Mr Cooper suggested pressing deadlines could be "severely detrimental" to the project as potential investors or investor-operators may be deterred if another operator was already attached to the project.
He said by their nature luxury resort and hotel developments were a slower process and more difficult to achieve than commercial, retail or residential projects.
"Viability of such schemes are usually difficult to attain, as is debt funding," Mr Cooper wrote.
"Resorts usually are far more challenging and less common than hotels, as are regional resort projects outside major city centres.
"Regional luxury resort development, and even more so 'greenfield resort development' as is Badderam, is considered by the market as a very high-risk development activity."
Mr Cooper said the initial phases of the development, which aligned the investment capital and debt, resort management, branding and marketing, required a "great deal of flexibility".
"This process is intricate and often time consuming, due to the relatively limited pool of parties with the appropriate ability and appetite for such high-risk development activity," he said.
One of the suggested infrastructure agreement amendments states that on or before December 31, 2021 the developer will provide council evidence they have entered into a binding management agreement with a five-star operator.
Council is yet to decide on the application.
Ms Meyer said if they were successful, they would continue to work "diligently to attract the investment dollars required to construct".
"It just takes one visionary to go first," she said.