The foray of a Mildura-based brewery into Ballarat has seemingly come to an end, as a key parcel of land in the Ballarat West Employment Zone is reacquired by Development Victoria.
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The exit frees up a massive block of commercial land in BWEZ - one of the City of Ballarat's and state government's key employment projects in the region.
In a letter to investors published on Wednesday, the board of Broo Limited confirmed Development Victoria had exercised its right to call back a 15-hectare block of land in the industrial zone, under a contract the company signed with the government body.
The property, on 2 Liberator Drive, Mitchell Park, was handed back to Development Victoria at a cost of $2.3 million.
The dream of a 500-metre zipline from a 45m tall viewing platform - inside of an environmentally-friendly brewery and 100,000 capacity outdoor venue, it seems, is over.
The board said the company would use the proceeds to repay the entire loan, land outstanding rates and taxes associated with the land in full, reducing the company's total liabilities by $2.1 million.
"Whilst this is ultimately a disappointing outcome for all Broo shareholders, the board made every possible attempt in a range of ongoing discussions to extend the contract with DV and explore feasible commercial outcomes that could be beneficial for all stakeholders," Broo chairman Kobe Li said.
"Unfortunately, despite our best attempts to find workable solutions, the extension was not granted by DV. The board continues to focus on delivering value for shareholders with the ongoing strategic review."
The move leaves a substantial 15-hectare hole in the Ballarat West industrial zone - a centrepiece in the plan to develop Ballarat's manufacturing and freight capability.
Broo Limited first came onto the scene in Ballarat in 2017, purchasing a 15-hectare block of industrial land in Ballarat under the auspices of Development Victoria.
A Development Victoria spokesperson said Broo was unable to fulfill its development agreement obligations, and as such was required to sell the land back at its original sale price.
"We are now reviewing our options for the development of this prominent site in Stage 1 of BWEZ and remain committed to achieving the best outcome for BWEZ and the Ballarat community," a spokesperson said.
BROO'S BLUES - How Broo came unstuck
- 2009: Kent Grogan establishes Broo
- 2011: Broo offers shares if you buy a slab
- 2013: Launches 'Australia Draught', offers 20% of sales to charity
- 2014: Sponsors NASCAR racing, wrestling
- 2016: Issues 75m share prospectus at .20 a share, despite never showing a profit. Admitted to ASX
- 2017: Buys Mildura Brewery for reported $1m
- 2017: Buys 15ha at Ballarat's BWEZ, announces a $100m development
- 2018-2022: Reveals continued losses, intention to sell BWEZ land
- 2022: BWEZ sale deal falls through, Broo directors resign
The group's plan was to develop the site into a $100 million environmentally friendly brewery, with a 10,000 capacity multi-function outdoor space.
In addition the brewery planned to build a bar at Delacombe Town Centre after securing a lucrative distribution contract in China.
The Delacombe bar idea was ultimately shelved by the company, with a focus on developing its BWEZ brewery and outdoor space.
However, the block sat empty, as Broo was plagued with planning issues and a tumbling stock price.
In early 2021, the group's Chinese distribution deal fell apart, and Broo moved to sell the BWEZ property - inviting the criticism of City of Ballarat councillors, who accused Broo of holding onto the land for a profit.
The sale of the land to Bentley Property Group, a Ballarat firm of developers, fell through in a plan potentially netting Broo a $5 million profit on the block.
Elsewhere in BWEZ, construction has begun on Ballarat's $23.5 million intermodal freight hub, to shift an estimated 300,000 tonnes of grain to the site once complete.
According to the state government, the hub will be able to handle 24,000 containers every year, with three concrete sidings for 600-metre freight trains and "substantial" hardstand for loading, unloading, and storage at five serviced lots.
Planning approval has been granted for Stage 2 comprising 23 lots adjacent to Ballarat Airport. Construction is anticipated to begin next year with new businesses expected to make Stage 2 their home in late 2024.
There was strong interest for the recent Expression of Interest process for two lots comprising about 20 hectares in Stage 3 and also for approximately 30 hectares of land in Stage 4. The remainder of Stage 3 land is still to be released for sale.
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