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Festival Plaza cost back on taxpayer

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UPDATED: The State Government’s rejection of Walker Corporation’s comprehensive proposals to redevelop the Festival Centra plaza means that the taxpayer will now have to pay the bill for its much-needed redevelopment.

Under the original process, developed by former Infrastructure Minister Pat Conlon, Walker Corporation would have constructed a mixed-used building and rebuilt the crumbling car park. In return, the taxpayer would have gained a redeveloped plaza.

As InDaily has reported extensively, the Walker proposal hit a brick wall in Government – due in part to the concerns of the Festival Centre . The lofty plans were scaled back and back, until they were reduced to simple a car park deal.

Despite the Government’s spin, Walker didn’t propose a towering “office block” (although it seems that the concept of “towering” is in the eye of the beholder – certainly it didn’t bear much resemblance to the soaring image released by the Government in conjunction with the Development Plan Amendment for the area).

It actually wanted to build several lower level, but still significant, constructions which would have provided some office tenancies, yes, but also retail, entertainment and cultural spaces. However, some of those who have seen the final version of the proposal – completed in October last year – believe it didn’t allow enough open space on the plaza.

Yesterday, the Government announced it planned to spend $46.5 million to “transform the Adelaide Festival Centre Plaza into a unique cultural and entertainment hub within the Riverbank Precinct”.

The announcement is almost a carbon copy of the Liberals’ plan, announced in January, to turn the plaza into our own version of Melbourne’s Federation Square.

There are some subtle differences.

Under the Liberal plan, the Festival Centre would have control of the car park, thus gaining a much-needed revenue stream.

This issue was at the heart of the Festival Centre’s opposition to the Walker proposals.

Labor’s solution is essentially a compromise.

Under the plan announced by Premier Jay Weatherill yesterday, a 1400-space car park will be developed by Walker Corporation to replace the current car park.

The Government will lease 400 car parks from Walker at a capped cost of $30 million over 30 years. About 400 car parks will be provided to the Festival Centre to be used as an “ongoing revenue stream”, with some reserved for Parliament House. The remaining 1000 parks will be leased to the Casino for its exclusive use “on terms to be agreed with the parties and on similar terms to that of the State Government”.

The question is what the taxpayer will get for its money, apart from the car park – and how much it will really cost in the end.

Weatherill said yesterday the State Government funds would contribute to the car park, the plaza and “the interface between the plaza and the Adelaide Festival Centre”.

Bearing in mind that the first stage of the Victoria Square revamp, for example, is costing close to $30 million, there will clearly need to be more taxpayer input if the plaza is to meet the Government’s ambitions.

The fine detail will be worked out by a new Riverbank Authority headed by former Tourism Australia boss Andrew McEvoy.

Liberal leader Steven Marshall has told InDaily that he will stick to any contract signed by the Government, so the plaza deal will go ahead, no matter who wins the March election.

The whole saga seems to stand in stark contrast with the Government’s treatment of the consortium that will develop industrial land at Gillman.

In that case, also reported extensively by InDaily, the Cabinet simply signed off on the deal – within the space of a few short months, partly on the basis that it wouldn’t cost the taxpayer any money. No tender, no drawn out negotiations.

Walker Corporation could be forgiven for scratching their heads at the treatment ladled out to them over the past year.

They first won an open bid to develop a proposal for the plaza in late 2012. Since then they’ve been put through the wringer and forced to progressively downscale their ambitions.

It’s a very interesting contrast.

 

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