The billionaire Liberman family’s ethical investment house Impact Investment Group has been accused by investors of acting dishonestly and unfairly over a $70 million property deal in Sydney’s Central Park precinct.
The investors, which include Sydney’s wealthy Alteri family through their philanthropic foundation set up to support indigenous children, are suing the funds management arm of Berry Liberman and Danny Almagor’s ethical investment manager in the Supreme Court of Victoria.
The investors allege they did not receive any of the estimated $11 million in profits that were made when Impact sold the building. The investors together put in $2 million.
HoweveImpact has hit back at the allegations.
“Impact Investment Group always acts with integrity and honesty, but that doesn’t mean we can be pushed around,” chief executive Daniel Madhavan told The Age and The Sydney Morning Herald.
Ms Liberman, the daughter of billionaire Melbourne businessman Boris Liberman, is part of a family regarded as one of Australia’s richest clans. Impact, which invests in range of sectors including green buildings, social housing, renewable energy, is currently seeking backing for a new $70 million impact investment fund.
Despite its admirable ideals Impact has sometimes run into criticism. Roy Morgan Research owner Gary Morgan accused the group of acting unethically in 2015, when it evicted the pollster from its Collins Street office in the week before Christmas over unpaid rents. The dispute was later resolved between the parties.
In the Central Park office tower case, the investors put in millions to fund the development of the green office tower and allege the agreement included a future ownership stake through an equity raising. However, the building was sold ahead of schedule after it secured a top tier tenant, the University of Technology Sydney. Superannuation fund MTAA purchased the building for $70 million in 2018.
“Impact Investment Group on its own behalf and on behalf of IFM dishonestly stated that the reason for the decision to not proceed with the transactions contemplated by the funding agreements was “due to receiving, over the past months, a number of compelling unsolicited offers from third parties to purchase the property” when, in fact, IIG and IFM had solicited offers from third parties through Capital Transactions Australia and Colliers, alternatively CBRE,” court documents allege.
Impact said in its defence that the contract between the investors made it clear it was a loan arrangement that gave it the choice of returning the deposit or granting the investors equity in the project, through an equity raising.
“This is a contractual dispute about a guaranteed loan that paid back the lenders in full, with a 23 per cent return on top. That’s a great return but they want more than that. They want more than was in the contract they signed,” Mr Madhavan explained.
“We have maintained the same position throughout, and that won’t change whether these lenders settle, or proceed to court.”
The investors declined to comment.
The case continues.
Source: Thanks smh.com