Around 126 units in the project have been presold.
Bensons purchased the Warde Street site for $10 million in May this year having earlier settled on another neighbouring site in Moreland Street in April for $8.25 million.
The group plans to build another 26-level project with 198 apartments called Liberty Two on Moreland Street, the first site to gain high-rise planning approval in Footscray’s Joseph Road precinct. That tower has an end estimated value of $120 million and is expected to begin selling in 2021.
Bensons’ court dispute with Sydney-based Atlas, 60 per cent-owned by former Macquarie Private Bank boss Guy Hedley, centred around an alleged shortfall in first mortgage funding for both sites.
Mr Hedley said both parties had agreed on withdrawing the action and signed a consent order without any costs awarded.
“Our issue was always the terms that we were funding. Bensons is a solid partner and we were always happy to work with them,” he said.
Atlas has agreed to be first mortgage funder for both projects. “We wanted a set of terms and conditions acceptable to our investors and that’s what we got,” he said.
Mr Hedley said by the time Bensons completes Liberty One in 2022 “it will be the perfect time for it to be in the market”.
Commercial real estate agency JLL recently reported a significant slump in new apartments being marketed suggests the country faces a shortfall in units in about 18 months’ time.
Once current supply and leftover stock is absorbed, not enough new supply is in the pipeline to avoid a potential under-supply in 2021, the agency claims.
Bensons’ court dispute also alleged Atlas had significant unsecured debt exposure to failed developer Steller group.
Mr Hedley said, following Steller’s collapse, Atlas had secured control of 16 properties.
About five have since sold with a number of others currently on the market and due to sell before Christmas, he said.
“We’ve been working through a program of selling down the assets we’ve got possession of, and that’s ongoing,” he said.
The market for commercial real estate has moved in Atlas’ favour and was now “more favourable than at the time these guys got into strife”.
“That’s positive,” he said.
Property Editor at The Age and BusinessDay journalist for Fairfax’s theage.com.au, smh.com.au, watoday.com.au and brisbanetimes.com.au.