Administrators appointed to $100 million NSW aged care Crighton Group
An aged care and property development group had administrators appointed yesterday after the company collapsed as a result of long delays in planning approvals.
Riad Tayeh and David Solomons of de Vries Tayeh were appointed as administrators of the Crighton Group, which is made up of 15 companies.
The Crighton Group has been operating for over 25 years and has around 30 staff.
The companies now in administration are the Hermitage Lifestyle Resort, Crighton Properties, Myall River Downs, Crighton Building Co, Crighton Lifestyle Resorts Real Estate, Myall Quays Shopping Village, Lifestyle Resorts, Woodstock at Jamberoo, Crighton Bowral, Myall Down Angus Stud, Red Gum Grove, Laurieton Lifestyle Resort, Crighton Mudgee, Crighton Byron and Crighton Bathurst.
The company Hermitage Management has not been placed in administration and Tayeh said at this stage the retirement village, Hermitage Lifestyle Resort, will continue to operate as usual.
"In the main the group has been the victim of the slow and unyielding process of getting approvals for developments," Tayeh says.
It has taken 11 years to get zoning through for some developments and no company can survive that sort of delay, and with the prevailing economic conditions it could no longer continue to trade."
The Crighton Group's major creditors are the ANZ, Commonwealth Bank and St George.
Tayeh says the Crighton Group is "not a fly-by-night group" and at its full valuation had land holdings worth over $100 million. However, recent falls in value mean the valuation is now closer to $30 or $40 million.
"The thing that has really hampered this industry and similar developers has been the inability to get projects up and going that have been supported by the community, this is not a good thing for the industry," he says.
"You can't have something being held up for 11 years, some of the things they have to do to get these developments through are unbelievable."
Geoff Cox, founder and joint proprietor of the Crighton Group, said in the past the development industry has had to go through "a lot of nonsense" to get master plan approval from the Department of Planning.
In developing the Tea Gardens, Cox says ANZ lost patience after nine years in development.
"The land was rezoned as a residential parcel in June 2000, then three years later they brought through an embargo on residentially zoned land being developed unless subject to a master plan," he says.
"As part of that plan, we had to prepare a flood evacuation plan for 87 years' time for what would happen in the event of a 'probable maximum flood event', which is what happens when a cyclone comes through in the tropics – but we are not in the tropics."
Cox says the Crighton Group had to spend a huge amount of time going through computer modelling to prepare an evacuation plan for assumed residents in 87 years' time costing $250,000.
"When you look at the lunacy of that you think it is madness," he says.
"We were totally gobsmacked at what we had to go through. It's an example of the absolute nonsense the development industry had to go through to get master plan approval."
Cox says the problem is not with the department of planning but with the "nefarious government agencies" that developers are required to deal with.
"Now the banks have essentially stopped funding retirement development outside the metropolitan areas," he says.
The administration of the Crighton Group follows the collapse earlier this year of Nepean Hospitals, which operates two aged care centres in Victoria: one 46-bed operation in Bendigo and another 125-bed facility in Mount Martha.
This article originally appeared on SmartCompany.
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