Rich Lister and former Toll Group boss Paul Little has sold his controlling stake in Little Projects to directors Leighton Pyke and Paris Lechte, who plan to expand the development company further into industrial, hotel and student accommodation.
Mr Little, who turned 71 this week, said the sale of the business to development director Mr Pyke and construction director Mr Lechte would allow him to stop playing a full-time development role and focus on investing in his current projects and some new ones.
“There’s no scaling down at all,” Mr Little told The Australian Financial Review on Wednesday.
“It’s just that property is very lumpy and it’s also very time consuming and it’s a good time to transition out of a full development role into an investment role. It’s more time to pore over balance sheets of the other entities that we’ve got and one or two others I’m looking at.”
The value of the transaction was not disclosed.
It has been a lumpy year for the company. Financial documents filed with regulator ASIC show net profit after tax for the company in which Mr Little is the sole shareholder more than halved to $10.3 million in the year to June from $24.8 million a year earlier. Sales revenue jumped to $60 million from $12.7 million as site acquisitions also jumped to $52 million from $10 million.
The company, which says its policy is to “maximise payment of dividends”, did not pay a dividend.
Mr Little will hand over control of the company from January 1. He will retain ownership of his other businesses including Little Real Estate, aviation and the subdivision that owns broadacre sites at Suffolk Park and Dayton, north-east of Perth
“The market in WA has been through a more difficult phase but it appears to be straightening out now,” he said. “It would probably be a mistake to look at selling out of the estates we currently have.”
Mr Little said his move out of the development company would be gradual, as he would remain involved while it worked projects such as Signature Broadbeach, Melbourne’s Hyatt Centric hotel, the Melbourne University Little Hall student accommodation building, One Centre Road Brighton and Hedgeley in Malvern East, both in Melbourne.
“It’s a transition that will take probably 3-4 years until some of the current projects – some of which haven’t even started – are finished,” he said.
“My appetite to be involved as a typical developer has changed because the market has become more complex and so to be able to continue to invest is probably a better way for me to maintain an interest in the sector.”
Mr Pyke said the expansion of the business deeper into other sectors would also be gradual.
“Our primary pursuit will always be residential -that’s what we know best – but the intention is to continue to grow into those markets as the opportunities arise,” he told the Financial Review.