Repossessed Dunk Island Hits the Block

The anchor asset of embattled funds manager Mayfair 101’s portfolio, Dunk Island, is back on the market.

The 135-hectare island was repossessed earlier this year after Mayfair 101 missed almost $3 million of repayments and failed to see through the $31.5 million contract price.

JLL Hotels and Hospitality Group has been tapped to sell the asset.

The listing comes as the James Mawhinney-led Mayfair 101 and it’s $80 million IPO Wealth Fund battles a winding-up application by corporate regulator ASIC. Mawhinney has vowed to fight the application and has tabled a restructure and rescue proposal to investors.

Dunk Island, one of only three freehold islands on the Great Barrier Reef, is located four kilometres off the coast from Mission Beach in far north Queensland. The island was acquired by Linc Energy founder Peter Bond in 2011 for $7.5 million shortly after it was devastated by Cyclone Yasi.

Mayfair 101 had planned a billion-dollar redevelopment of the island, with the group’s investor-facing brand, Mayfair Platinum, raising more than $100 million to finance the project.

Mayfair’s 15 year plans for the area included the acquisition of more than 200 properties in the Mission Beach area and the restoration of Dunk Island into the “tourism mecca of Australia”.

The island was previously owned by Qantas and cruise company P&O, while the former 4.5-star Dunk Island resort features 160 rooms, a 9-hold golf course and restaurants.

JLL’s Andrew Langsford said that the development of the island remains on the cards.

“We anticipate the Great Barrier Reef accommodation market to be a strong beneficiary of Australia’s high overseas spend, much of which is expected to be diverted to high-end resort locations.”

A report filed by liquidators in September revealed that $67 million of secured noteholders were unlikely to receive a return.

Grant Thornton liquidator Said Jahani said that the business model of the group was “not sustainable”, and that M101 Nominees Pty Ltd had been insolvent since its inception.

The Federal Court will hear ASIC’s winding-up application in early February 2021, while noteholders will consider Mayfair’s restructuring plan over coming months.

The Dunk Island asset is being offered for sale via an expressions of interest campaign.