Residential land developer RCL, one of the last remaining fragments of failed finance and property giant Babcock & Brown, has finally been placed in receivership.
The company, which has been suspended from trading from the Australian Securities Exchange, released a statement confirming Korda Mentha had been appointed receivers and managers of the company on February 22.
Receivers Mark Korda and Bryan Webster were contacted this morning by SmartCompany, but neither were available to reply prior to publication. However, it is believed the developer’s operations will continue for the moment.
The company said in the statement that receivers and managers were appointed by the secured creditors of the RCL Group Trust, Torchlight Real Estate Fund.
The receivership comes as the residential property industry continues to suffer. Yesterday it was revealed a major Queensland apartment project worth $170 million had also been placed in receivership due low sales.
According to reports, RCL has been placed in receivership due to outstanding payments on its debt facility, associated with its Mernda residential land project. Torchlight acquired RCL’s debts last November.
The receivership comes during a tumultuous time for the company.
It is understood RCL shareholders Payce Industries, Lanox and Babcock & Brown subsidiary LTHC organised a meeting with the Takeover’s Panel to replace current board members, but a clause in Torchlight’s debt agreement allowed the company to put loans in default if changes in management occurred.
RCL has also had a complicated ownership structure. It was formerly called Babcock & Brown Residential Land Partners, under a subsidiary of Babcock & Brown which survived despite the parent company collapsing in 2009.
The two separated in 2010 after managing group Babcock & Brown Residential Land Partners Services bought out the company. It was at this point the company changed its name to RCL Group.
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