Aspen starts Swan Valley development

Property funds manager Aspen Group has started the first stage of construction at its 900-lot St Leonard's Estate in the Swan Valley, as it halves its debt following the completion of a recapitalisation process.

In an update to the market today, Aspen said the first stage of St Leonard's included 65-lots already sold, representing 80 per cent of the stage, and the construction of a 21 home builder display village.

Aspen also said there was renewed buyer interest in the September quarter for its Dunsborough Lakes Estate.

"Interest has been predominately in traditional lower priced lots with early signs that demand for higher value golf front lots is also improving," it said in a statement.

"The recent opening of the Forrest Highway has reduced the travel time between Perth and Dunsborough by 30 minutes, making the estate more accessible to Perth buyers."

Aspen also completed its recapitalisation process with various funds under the company banner undertaking one-off equity raisings.

The recapitalisation provided Aspen to negotiate revised finance facility terms with maturity dates extended for Aspen Development Fund No 1, Aspen Dunsborough Lakes Ltd and St Leonards Estate Pty Ltd.

As a result of the equity raisings and surplus operating cash flows, Aspen Group said it has reduced its debt from $20.3 million, as at the end of the 2009 financial year, to about $10 million.

Aspen managing director Angelo Del Borrello said that with the recapitalisation process now concluded, the group's development funds were now well positioned to progress their respective development projects.

"We are very pleased to have bedded down the equity and debt arrangements, providing the Funds with solid platforms to develop their projects and take full advantage of the improving market sentiment," he said.