Blame game over Perth city tower

THE receiver of the $500 million Raine Square project in Perth’s CBD has rejected claims by developer Luke Saraceni.

Mr Saraceni has said Bankwest ignored his refinancing proposals in order to take control of the asset at the cheapest possible price.

KordaMentha principal Mark Korda said proposals by developer Westgem Investments, jointly owned by Mr Saraceni and fellow developer Hossean Pourzand, had been unsuitable for the banks, which appointed receivers on Tuesday.

The receivership was triggered when Westgem missed a $50m payment due on December 31, following delays to the troubled project caused by a bitter dispute between Westgem and original builder Salta Constructions.

“The banks have given them every opportunity to sell down assets or find a white knight to meet the payment,” Mr Korda said. “The banks were in very lengthy negotiations” with Westgem.

But Mr Saraceni accused the banks of failing to discuss his refinancing proposals. He questioned the motivation of the banks in taking control of the project, saying it was fully funded to completion and would generate a surplus.

“Over . . . months, Westgem had tried to engage with the security holders to progress a range of commercial proposals” intended to reduce the banks’ exposure and refinance the associated debt, Mr Saraceni said.

“The security holders did not at any time engage with Westgem” on any of these proposals generated by Westgem, he said.

Date: 13 January 2011 | For the full report, please visit http://www.theaustralian.com.au