Two more Raine Sq. related assets seized

The fallout from troubled office development Raine Square continues, after receivers seized control of a nine storey office tower on St Georges Terrace and the New Esplanade Hotel.

Ferrier Hodgson partners Martin Jones, Andrew Saker and Darren Weaver were jointly appointed receivers by the Commonwealth Bank to the office building, located at 251 St Georges Terrace and owned by developer Hossean Pourzand on February 18.

The hotel is owned by Pakwest, a private company directed by Mr Pourzand and Luke Saraceni, and was placed in the hands of the receivers February 22, a statement from Ferrier Hodgson said.

Mr Jones said his first step would be to review the two properties' income streams and operations.

"Once we have a clear understanding of the operating and management arrangement for each property, we will be in a position to consider an asset realisation strategy," Mr Jones said.

Mr Jones said the bank had been working with Mr Pourzand throughout the past two months in relation to the debt on the office property, but a refinancing proposal did not provide the bank with "sufficient certainty of repayment".

The total number of assets now in the hands of receivers or administrators from the Raine Square fallout is now six.

Financiers Bankwest and Bank of Scotland appointed receivers to Mr Pourzand and Mr Saraceni's Westgem Investments, developer of Raine Square, in January.

Mr Saraceni has launched legal action against the banks, claiming that it had appointed receivers to the project invalidly.