The future of a coveted Sydney hotel project has taken a turn for the worse after the developer’s founder was slapped with a $140 million tax bill.
The Guardian has reported the Australian Taxation Office (ATO) has hit controversial businessman Huang Xiangmo – a notorious political donor and real estate developer – with the massive tax bill.
Huang, the founder of Yuhu Group – the developer behind One Circular Quay – was last week accused in federal court proceedings of intentionally setting up complicated business structures in Australia to frustrate efforts to recover money from him, according to The Guardian.
The news comes after Huang was linked by the New South Wales corruption commission as the source of $100,000 in political donations, delivered in an “Aldi bag”, to the Labor Party.
The One Circular Quay project is among more than $1 billion in assets linked to Huang and his family that have been left behind in Australia after the embroiled businessman left the country in December. The current Yuhu chairman, Huang’s son Jimmy Huang, has also left the country, reportedly flying from Sydney to Hong Kong last month.
As a result, the future of the One Circular Quay project – a planned five-star luxury residence with 165 luxury apartments in one tower and a 182-room hotel in another – is up in the air, with The Guardian reporting that a builder is unlikely to be appointed, at the earliest, until early next year.
The project is also encumbered by a mortgage to a “mysterious” British Virgin Islands company that has previously told Australian authorities it has no assets, according to The Guardian.
Yuhu – whose prime assets include Eastwood Shopping Centre, Pymble Corporate Centre and the Miller residential tower – reportedly transferred ownership of the land at One Circular Quay on 20 December, but has retained the right to develop the land.
This comes after the developer acquired the Circular Quay project from Chinese developer Wanda.
Demolition work has started at One Circular Quay, but it is believed that Wanda was unable to find a builder through a tender process last year. The Guardian, citing industry sources, reported Yuhu planned to open the job for tender in the new year.