Moreton Island property owners say Tangalooma resort fees are turning dreams into nightmares
Updated
Property owners on Moreton Island have broken their silence about a "David and Goliath" dispute with the island's management, which they say is threatening to send some of them broke and has shocked property values.
Over the past decade, some have seen their annual fees rise more than 300 per cent, leading others to sell for a fraction of the original price.
Tangalooma Island Resort holds a perpetual lease from the Queensland Government over the developed section of the island, which was a result of a deal struck in the glory days of the former Bjelke-Petersen government when the tourism industry was undergoing a major change.
Like a council, it provides lots — including homes and apartments — with waste disposal, gas and electricity connections, sewage, roads, access to swimming pools, as well as beach, jetty and garden maintenance.
Property owners have for the first time spoken out publicly, saying they were powerless to stop the operating expenses from rising.
Dreams turn to nightmare
Drew Wilson built a house behind the resort in 2003, but said the property now threatened to bankrupt him.
"Our dream house has become quite the nightmare really — we are fearful for our financial future," he said.
Mr Wilson's total operating expenses have risen from $9,000 to $41,000 in the past 12 years.
"We have appealed to every government body we can think of for help," he said.
"We're stuck in a house that is slowly driving us bankrupt and that point is coming closer and closer — it's a wasting asset — it's worth less and less each year."
Shortly after operating expenses began rising about 10 years ago, the resort's management introduced a 'discount' for some residents at its own discretion.
A clause on the invoices states the discount was valid so long as "neither party shall hereafter dispute, challenge or otherwise contest this invoice and the calculations contained herein".
Warren Patterson built a home on the island in 2004 and is also struggling to pay the annual charges.
He said many others are too frightened to speak up out of fear of losing their discount.
"Everyone is too frightened, because if they lose the discretionary discount, you know I can't afford to pay that on and on and on," he said.
"I don't know what I'll do? Do I walk away? Do I grow bankrupt?"
"I could still see the value if changes were made — the properties and resort would be worth a lot more money.
"It's David and Goliath … I don't know how this could happen in Australia — it's broken my marriage, it split my family."
ABC News has spoken to another eight owners with similar concerns.
The resort was first built in the 1970s after developers struck a deal with the Queensland Government, securing a perpetual lease that included ongoing access to a slice of the island.
The Osborne family purchased the development in 1980 and turned it into one of Brisbane's biggest tourism attractions, which now has more than 300 staff.
Last year, the Tangalooma resort had a turnover of $52 million and a share value of about $24 million, according to ASIC documents.
Most of its shares are owned by a company co-directed by Brian Osborne known as Dransbrook Pty Ltd.
Dransbrook also owns real estate on the mainland worth more than $6 million, including the Tangalooma Island Resort Wharf at Pinkenba near the mouth of the Brisbane River, and a four-bedroom apartment at Hamilton worth at about $1.2 million, which is stated as Mr Osborne's address.
The ABC has spoken to Mr Osborne but he has declined to comment at this stage.
Fears for property values
A real estate agent who spoke to ABC News on terms of anonymity said prospective buyers changed their minds as soon as they read the fine print.
"People won't touch it — no-one will touch it because of those fees," he said.
"As they see the fees, they are no longer interested — they walk away."
The agent said property values at Tangalooma had plummeted in recent years.
"When they first came out, they were over $1 million — and they should be over $1 million — but at the moment I know people who are going to sell for $500,000 [and] $600,000 and probably less than that."
One owner who spoke to ABC News bought two blocks of land in 2003 for about $540,000.
The lots were sold last August for $50,000.
Lawyer Michael Byrom, who is acting on behalf of another sublease holder, said the situation was leaving owners in limbo.
"It's the transparency issue and also the regulation of those issues that is most concerning," he said.
"The question ultimately comes down to the issue of 'Have I been over-charged and if I have, by how much?' — these are investments for many people.
"Where there is a lack of transparency about the charges or if there is uncertainty about what you might be charged from year to year — to my mind, nobody is going to buy into that sort of investment with that lack of certainty."
Department to make enquiries
The head lease is overseen by the Department of Natural Resources to the "satisfaction of the Minister".
"The lessee shall at all times provide and maintain on the leased land tourist accommodation and facilities to the satisfaction of the Minister and shall faithfully observe and perform all terms and conditions of any agreement entered into with the director-general of tourist services with respect to the continued conduct of a tourist resort on the leased land," the title states.
A department spokesman said enquiries were underway to see if the department could refer the matter to mediation but could not give a guarantee if it could directly intervene itself.
"Details of the dispute are a private matter between the parties," the spokesman said.
Topics: local-government, activism-and-lobbying, government-and-politics, people, human-interest, tangalooma-4025, cape-moreton-4025, qld, australia, brisbane-4000
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