COUNCIL EVICTING TENANT OVER $1.1M UNPAID RENT
Written on the 30 March 2016 by Nick Nichols
THE City of Gold Coast has issued an eviction notice to wealth creation company Members Alliance after deciding to pull the pin on the wayward tenant, alleging it owes $1.1 million in back rent.
Council CEO Dale Dickson (pictured below) fronted the media this morning to explain the city's action which comes after months of frustrating negotiations with Members Alliance and its directors.
The company, which bills itself as providing clients with 'proven strategies and techniques to ensure a financially secure future', occupies 3500sqm across five floors of The Rocket building at Robina.
The space is held under a sub-lease from the council on space that formerly housed the now defunct water utility Allconnex.
Members Alliance, which is headed by Colin Macvicar, secured a six-year lease from the council at $2 million a year.
The company employs a staff of 240 and the proposed eviction could put those jobs in jeopardy.
Dickson says he took the extraordinary step to brief the media on the spat as a matter of public interest.
"Unfortunately the tenants haven't done the right thing by city ratepayers," he says.
"We have tried to work with Member's Alliance for a number of months now and we had a meeting as late as Wednesday last week.
"Unfortunately despite the city's best efforts we have got to the point where we have to bite the bullet on behalf of ratepayers and issue the notice to vacate."
Dickson says the excuses offered by the company, as well as a number of undertakings over the past month, have proved 'unsatisfactory.'
In a statement to Business News Australia, Members Alliance confirms it has held discussions with the city council regarding its lease and that it has presented a renegotiated offer of terms to take effect on April 29.
"The council have chosen not to accept this offer and have taken a harsh line in full knowledge that we are a going concern employing hundreds of people," say a company spokesman.
"We are now looking at our legal options in regard to this matter."
Under the terms of the current order, Members Alliance has until April 6 to vacate the building, after which the city says it plans to engage local agents to find new tenants for the space.
Dickson says if a new lease is not secured, the council will consider using the space to house its 2018 Commonwealth Games project team.
The council has three years to run on the lease and Dickson indicates that due to the stricture of the company the council won't be in a position to sue for the back rent.
The council already holds about $400,000 in bond which he says will defray some of the costs associated with recovery.
The irony that a wealth creation company has found itself in this position has not been lost on Dickson.
"Yes it's ironic," he says. "I don't want to say too much about the organisation itself. It's an important public interest issue and it's worth disclosing publicly."
Dickson says he only holds faint hope that Member's Alliance will come up with the rent shortfall by April 6. However, he is not particularly confident given the history of discussions to date.
Member's Alliance, which is controlled by David Domingo, Richard Marlborough, and Colin Macvicar, faced a potential court wind-up action in February over an unpaid debt of $50,000 by a Melbourne-based supplier.
Author: Nick Nichols