‘Remon, that is illegal’: Controversial Sydney developer accused of fraudulent rent scheme

Controversial property developer Remon Fayad is alleged to have engaged in “serious wrongful conduct”, after a court heard he’d tried to organise a fraudulent deal to have a tenant inflate a rental agreement so that Fayad could get a better sale price for the business premises.

“Remon, that is illegal,” said his tenant, Charles Assaf, who runs the childcare business Montessori Academy, the NSW Supreme Court has heard.

Only months before he jetted off for his multimillion-dollar wedding extravaganza in Florence last July, Fayad, 37, was in a precarious financial position facing bankruptcy proceedings against him and his older brother, Fayad Lee Fayad, over combined tax debts of more than $20 million.

Both Fayads are former executives of the family development company Dyldam, which collapsed in 2020. Their father Sam Fayad has the unfortunate record of having the largest bankruptcy in the nation, with personal debts of $2.8 billion.

Despite being bankrupt, Sam Fayad and his wife Maria flew first-class to Italy to enjoy their son’s four-day wedding festivities, with the flower decorations alone costing more than $500,000.

In a Supreme Court judgment handed down last week, Justice Ian Pike ruled that Remon Fayad wrongfully terminated the lease of a Montessori childcare centre in Thallon Street, Carlingford, only weeks after negotiations for Assaf’s company, Montessori Academy, to buy the premises broke down.

In late 2020, the Montessori childcare centre agreed to lease the ground floor of the Dyldam-related development The Somerset, a largely residential development. The 10-year lease was for $216,000 per annum, which was to increase by 3 per cent annually. There was also an option to renew for two further 10-year periods.

The Dyldam-related company that developed the Thallon Street site, C88 Project, followed a well-worn Dyldam pattern in which associated companies, having completed the development and having paid Dyldam handsomely for construction services, then collapse, owing creditors, including contractors and the ATO, millions of dollars.

Before the company goes bust, several apartments are transferred to the Fayad family, friends and sometimes people chasing them for money. In the case of the Thallon Street development, liquidators discovered that a tradie, owed a substantial amount of money by Dyldam, had taken up occupancy in one of the apartments.

In 2019, Remon Fayad’s company, Thallon Hld, bought the ground-floor premises for $3 million from C88 Project, of which his father was the sole director. The development company subsequently went bust owing more than $56 million.

In April 2024, Fayad appeared to be “quite anxious” to sell the premises tenanted by the childcare centre, having dropped the asking price from $5 million to $3.5 million.

Assaf gave evidence that, in early April 2024, he received a call from Fayad, who said he wanted to increase the rent on paper by $50,000. “This will increase the value of the property so I can sell it. You won’t actually pay more because I’ll separately give you back the 50K personally.”

Assaf, who took contemporaneous notes of the conversation, said he told Fayad: “Remon, that is illegal and it is against my duties as a director of Montessori. There is no way.”

Fayad is alleged to have replied that no one needed to know and, “I can give you the money personally.”

With the sale having fallen through, on June 24, 2024, and without prior warning, Fayad’s company terminated the childcare centre’s lease on a technicality.

Fayad told the court that Assaf, anticipating a problem with the lease, had deliberately fabricated a file note to later use against Fayad’s company. “Such a theory, in my view, is absurd, bordering on fanciful,” said the judge, who also said that, “having carefully observed Mr Fayad giving evidence”, he did not accept much of what Fayad said.

Remon Fayad, his brother and father are the subject of restraining orders granted by the Federal Court in April. The order prevents them from selling assets while the liquidator of another collapsed Dyldam-related company chases them for $33 million.

The bankruptcy proceedings brought against the brothers by the deputy commissioner of taxation will return to court in August.

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