Projects - Risk Management
Project North West
Pre-sales risk review
Summary
- Pre-sales risk review
- 80 lots of which 60 were pre-sold
- Value of pre-sales – $25m
Issues
- Major Trading Bank was considering funding a project in North West Sydney and requested a pre-sales review
- Noted significant deficiencies in pre-sales contracts
- Identified that smaller lots had achieved a higher proportion of pre-sales
- Established stakeholder deposits were less than pre-sales contract deposits, possibly indicating rebates
Solution
- Recommended pre-sales sample for lawyer to conduct further review.
- Noted risk to GRs of higher value lots due to smaller lots achieving higher proportion of pre-sales
Outcome
- Major Trading Bank complied with our recommendations for the project