Seashells Hospitality Group CEO Paul King drops Frenchman Bay luxury retreat citing ‘absurd’ conditions

A developer has dropped plans for a $5m luxury resort overlooking Frenchman Bay over “absurd” conditions that would require them to return the land for free in the event of coastal erosion. Seashells Hospitality Group managing director Paul King announced the shelving of the project — that has been in motion since 2018 and was approved by the Regional Development Assessment Panel in September 2024 — on Monday. Mr King said the “absurd” conditions in the December 2024 application to the RDAP would render the project “non-commercial” and “unworkable”. Under its classification as a vulnerable coastal area — which means it is susceptible to “coastal inundation” or flooding within the next century — the site must follow a coastal hazard management plan, which includes the removal of at-risk infrastructure if the shoreline recedes to within 33m of each asset. This would require the “potential removal and rehabilitation of the land to pre-development conditions at the landowner’s cost, and ceding the land back to the crown, free of cost and without any payment of compensation by the crown at the time the situations specified in the local development plan occurred”. Mr King said he was “annoyed and saddened” to drop the plans for the resort — which would have included a luxury lodge, studio apartments, two-level private pods and glamping tents — after five years of consultations and $600,000 spent in fees but that the new conditions made it “impossible” to obtain financial backing. “By adding the reinstatement and ceding to crown conditions, the WA Planning Commission and City of Albany have made it impossible for me to currently proceed with the development,” he said. “It would be foolhardy for any developer to take on such risk. “Our valuers have advised that the city’s added conditions stating the site is a vulnerable coastal area and the underlying LDP conditions have made it extremely difficult to get any commercial level of funding, and the conditions will devalue the asset in the future, and negatively impact resale. “These conditions were the subject of months of debate and discussion with the City of Albany as to their unsuitability for commercial development, but they still chose to apply the unworkable conditions. “It just leaves us scratching our heads.” City of Albany chief executive Andrew Sharpe said the city was not the decision-maker in this process and that they worked collaboratively with Mr King to review his requested amendments. “The city fully respects Mr King’s decision on whether to proceed with the development under the approved conditions,” he said. “However, it is disappointing to hear that the project may be placed on indefinite hold, as it has the potential to significantly contribute to Albany’s economic growth, tourism and business opportunities. “The city is supportive of the project and remains committed to facilitating its success within the established planning framework and State planning regulations.” Plans indicate the resort would sit 10-12m above the current sea level and 75-80m back from the high water mark. The City of Albany’s coastal hazard risk management and adaptation plan for Whalers Beach (Frenchman Bay) adopted in June 2024 indicates the shoreline could be “vulnerable to change” but noted “very little gross movement over the last half a century”. The plan and its research, which Mr King partly funded, show the bay’s gravel access road, lower gravel parking, boat access point, boat access stairs and lower bitumen parking face a high risk of impact by 2041. Mr King also cited the proposed desalination plant as “the final nail in the coffin” in his decision to put the plans on hold, stating that, if approved, it would deposit briny effluent in the bay. “My plans and aspirations have been weathered down by an overcautious non-commercial bureaucracy both at State and local government level,” he said. “The runs on the board speak for themselves but the Albany site has been just too difficult, and the team will now focus on other sites that include Broome and Exmouth.” The resort was to be located on Lots 1 and 2 Frenchman Bay Road, the former site of the caravan park that closed in 2006.