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City council suing Govt on Gillman land

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A chunk of the land at Gillman sold by the State Government to a developer is the subject of an ongoing court case between Adelaide City Council and the Government, InDaily can reveal.

The council is demanding almost $30 million from the Government for the land.

If successful, the claim would slash 75 per cent of the Government’s take from the initial stage of the controversial land sale. Renewal SA documents sighted by InDaily say the sale to ACP must be disclosed to the court as part of the ongoing case.

In 2009 the State Government compulsorily acquired Adelaide City Council’s 50 per cent stake in a 300ha section of the Gillman site, known as the Dean Rifle Range, for $1.52 million in compensation.

The council and the Government have refused to provide detailed maps of the land in question, but it is clear that a proportion of the 300 ha site is within the land involved in the ACP deal.

In 2012 the council challenged the compensation the Government offered, and the court case has been grinding on since – and is still underway –  despite the Government agreeing to sell at least a portion of the land to Adelaide Capital Partners in December.

“Based on the valuations received by the council, the portion of the land previously owned by council is valued at $28.6 million,” Adelaide City Council CEO Peter Smith said in a statement released following InDaily’s inquiries.

“The council subsequently argued to the State Government that we were entitled to further compensation.

“After being unable to negotiate an agreed settlement with the State Government (for the value of our share of the Dean Rifle Range land), the council issued proceedings in the Supreme Court in April 2012, seeking orders for compensation for the acquisition of its interest in Dean Rifle Range.”

The 300 ha Dean Rifle Range site  makes up a large part of the 400 ha over which consortium Adelaide Capital Partners has obtained an option to purchase from the State Government. It was unclear this morning of the Rifle Range site was included in its entirety in the ACP purchase.

ACP plans to purchase and develop the 400 ha in stages, with the first stage – which appears to incorporate the Rifle Range – costing the company around $40 million.

The deal has become shrouded in controversy with developers and – as revealed by InDaily this week – the Renewal SA board claiming the Government should have put the land to tender.

Since the court case began in 2011 the State Government and the council have both been working on detailed valuations of the land to present to the court.

Renewal SA documents seen by InDaily indicate the two parties have placed wildly different valuations on the land. Renewal SA has valued the area at $19 million. Adelaide City Council says it’s worth around $59 million, with the $28.6 million in compensation sought being 50 per cent of that.

Renewal SA’s 2012-13 annual report notes the agency will be responsible for any compensation the court orders.

“In 2011, the ACC instituted proceedings against the Minister, disputing the compensation payable for the compulsory acquisition of the ACC’s interest in the Dean Rifle Range.

“Pursuant to the arrangement between Renewal SA and the Minister in respect of Renewal SA becoming the 100% legal and equitable owner of the DRR, Renewal SA will be responsible for any compensation which may be determined to be payable, which exceeds the compensation amount ($1.52 million) paid by Renewal SA to the Court.”

A spokesperson for the Premier this morning said the Government never comments on ongoing legal proceedings.

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