Mascot Towers sale set to proceed after threshold achieved
The offer to acquire the notorious Mascot Towers apartment buildings for $30 million looks set to go ahead, after a minimum 75 per cent of unitholders in the strata scheme signed contracts to sell their apartments to builder Andrew Daoud’s Dowco Property Group.
In return, owners will be paid a fraction of what their apartments would have been worth – as little as $160,000 in some cases – had the building not been evacuated due to major construction faults in 2019.
“I can inform you that based on our calculations, which will later be confirmed, more than 75 per cent of owners by unit entitlement have signed and returned their contracts of sale,” said Mascot Towers case manager Tony Fisher in an email to owners on Wednesday.
A 75 per cent minimum acceptance threshold was set by Dowco in order for its offer to become unconditional.
Due to some lot owners “continuing to discuss their particular circumstances with their bank” and asking for more time to make a decision, Mr Fisher said Dowco had granted an extension until March 28 for contracts to be signed.
“The anticipated settlement date will, however, remain unchanged from the current date of May 3,” Mr Fisher said.
An email sent on March 16 to “stayers” – those who will not or cannot sell their apartments to Dowco – said Dowco’s intention “at this stage” was “to vote in a general meeting for the Owners Corporation to remediate the property”.
“Dowco will be a lot owner, and like all other owners will become a member of the Owners Corporation,” the email said.
Under the rescue deal put together by the NSW government, owner-occupiers with mortgages may be able to walk away debt-free, but many investors, who face the threat of bankruptcy if they sell and can’t repay their mortgages, are still waiting to hear what their lenders will do with their outstanding debt.
Based on feedback from a number of investors, it is understood Westpac and its subsidiary St George have agreed to treat owner-occupiers and investors in the same way, and offer both discounts on their mortgage balances of up to 40 per cent.
The NSW government – as part of a series of support packages that provide more support to owner-occupiers than investors – has negotiated with lenders to provide up to 40 per cent discounts on mortgage balances for owner-occupier loans, with the state to pay the rest.
However, investors were deliberately excluded from this 40 per cent mortgage discount offer and will not have their remaining loan balance automatically extinguished by the government.
Instead, some will receive up to $120,000 in support payments through a means-tested assistance package.
Sydney lawyer Tony Cordato, who is assisting some investors whose only real option may be to stay due to not being able to fully pay out their loan, said it was “unconscionable for investors to be placed into this position after almost five years since Mascot Towers was evacuated”.