AVJennings terminates option in Rocksberg land project

AVJennings Limited (ASX: $AVJ) has announced the termination of its Option in relation to the Rocksberg land in Caboolture, Queensland. The Company has decided to terminate its Option due to significant increases in expected development and infrastructure costs, which have not been matched by increases in forecast revenue. This decision will result in the write-off of capitalised development expenses of $17.2 million and a reduction of 3500 lots under control.

Executive Commentary on Termination of Option

The decision to terminate the Option was a difficult one, but the Board believes it is in the best interests of the Company and its shareholders. The funding previously earmarked for the Rocksberg project will now be redeployed, resulting in significant additional capital being available for the Company's other live projects over FY25 and FY26. This will be directed to development works including more built form on existing projects and activating the existing pipeline, with the aim of expediting project returns and improvement of the Company's ROE.

Summary of AVJennings' Termination of Option

AVJennings (ASX: $AVJ) has terminated its Option in relation to the Rocksberg land in Caboolture, Queensland due to significant increases in expected development and infrastructure costs, which have not been matched by increases in forecast revenue. This decision will result in the write-off of capitalised development expenses of $17.2 million and a reduction of 3500 lots under control. The funding previously earmarked for the Rocksberg project will be redeployed, providing significant additional capital for the Company's other live projects over FY25 and FY26. The Company aims to expedite project returns and improve its Return on Equity (ROE) through the redirection of funds to development works on existing projects and the activation of the existing pipeline.