They were a major backer of Steller, another failed property developer, which collapsed in 2019 owing them $93 million.

Loading

Spearheaded by Nicholas Smedley and Simon Pitard, Steller fell apart after buying multiple properties at the top of the market and settling as the market and values slumped.

OCP engineered the sale of multiple assets linked to Steller over a year-long period. It’s estimated the hedge fund is owed more than $200 million by Caydon.

OCP was contacted for comment.

Caydon’s collapse has embroiled Russo’s ex-partner Elvia who last week put the family’s four-bedroom mansion in Melbourne’s north-east suburb of Eaglemont up for sale.

The property with a pool, four-car basement garage, tennis court and two-storey high living room windows is on the market for between $8.5 to $9.35 million.

Neither Elvia Russo or her real estate agency Marshall White would comment.

Jirsch Sutherland and Malcolm Howell said preliminary investigations had revealed a “multitude of creditors, but the bulk are intercompany debts.”

“It’s early days,” Howell said. “My role as liquidator is to look at what assets are available to each of the entities.”

Howell said, while there are “substantial assets valued on the balance sheet of each entity”, in situations like this there is “normally a shortfall” to creditors.

Loading

The developer’s main company Caydon Property Group was placed in voluntary administration, rather than liquidation, to enable employees to get their entitlements, he said.

The same entity holds leases over the group’s offices.

Two of Caydon’s developments under construction in Alphington and Preston are not part of the liquidation process as they were funded by other lenders.

They will continue through to completion and sale, with at least 70 per cent of apartments sold in both projects.

Russo could not be contacted for comment.

At the time liquidators were appointed, he said it was “extremely difficult to make this decision.”

“Sadly, over the last few years Caydon has had to deal with one difficult market situation after another. The latest and really confronting challenge we’ve been facing has been the pricing factors affecting the Australian property and construction industry,” Russo said.

He cited significant disruption to the business from two years of COVID-19 lockdowns in Melbourne that severely impacted sales.

The developer’s difficulties were also exacerbated by the collapse of top-tier builder Probuild. It was under contract to construct the first stage of Caydon’s $600 million Nylex ‘Malt District’ development before it, too, went under in March.

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.