Ralph Praeger

Ralph’s client was contracted to develop the new Quest Hotel Group hotel at the dedicated business hub of Chermside on Brisbane’s northside. From the very start, the project had significant hurdles including a zoning change from residential to hotel, timeframe expectations, and construction, as well as sale and lease negotiations. Ralph was involved in each step of the development, negotiating with submitters to avoid a Planning Court appeal and subsequent construction documents. With about two months left to meet opening deadlines and avoid penalties, the builder went into receivership. Ralph then worked with the subcontractors to document a risk and reward arrangement that allowed the building to be completed on time. The client was delighted with this result, considering the number of challenges Ralph had to overcome for them. The sale of individual lots in the building also presented a challenge as they were subject to a lease to Quest Hotels, but also had to allow for an initial rent free period. Ultimately Ralph resolved this by provision of a rent guarantee and adjustment of funds at settlement.

Ralph’s developer client had negotiated with a small but long standing charity to acquire its land to redevelop into a drug and alcohol rehabilitation facility. With a potential end value close to $40 million, the project appeared attractive but unaddressed issues resulted in extensive negotiation and delay. Ralph designed an agreement for lease that provided for milestones such as tenant sign off on design, building approval, commencement and completion dates with rights to extend, funding dates and a mix of incentives by including some tenant fitout within the building work and reduced rental to allow for a staggered payment of security bonds. By using milestones, each party had certainty before moving to the next level of expenditure. Ralph structured the lease as ‘triple net’, meaning not only rental but all outgoings were recoverable by his client. If the complications with lease negotiation were not enough, Ralph’s client then took on an offshore partner resulting in the need for a complex joint venture agreement as the parties wanted to avoid Foreign Investment Review Board requirements, transfer stamp duty, capital gains or other taxation. The final joint venture was reviewed by Australian and Hong Kong lawyers together with an investor from Goldman Sachs prior to execution.