Deep cut to ditch unloved tunnel
The much-lauded infrastructure project that saw $3 billion spent on a tunnel under the Brisbane River has been sold for a song.
An agreement has been reached for the sale of the Clem7 tunnel after the company that ran it collapsed under more than a billion dollars in debt.
Queensland Motorways has now signed an agreement to acquire the tunnel for just $618 million, less than a quarter of its cost to build.
The original owner, RiverCity Motorway, folded in 2011 while still owing about $1.2 billion. The company could not come up with the funds when traffic through the tunnel reached just 25 per cent of forecasts before construction.
Reports say the deal will be finalised in the next few months, completing the sale to the company that already owns the Gateway and Logan Motorway toll roads. The price represents the current value of the tunnel, with the construction costs seeming impossible to recoup.
Investors are scrambling to see some kind of return on the tunnel; launching a class action against the company which made wildly inaccurate traffic forecasts for the initial prospectus.