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Govt asks own corporation to buy Victoria Square HQ


EXCLUSIVE | The State Government has asked one of its own corporations, led by former Treasurer Kevin Foley, to buy the State Administration Centre following repeated failures to sell it on the private market.

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InDaily can reveal that the Government has been in discussions Funds SA, whose chairman is Foley, about the potential for the state-owned corporation to buy the Victoria Square government headquarters.

The Government has been trying to sell the building – which contains the Premier’s office – for almost a decade, as a means to reduce state budget debt.

InDaily asked the Government whether Funds SA had been encouraged to acquire the building.

A spokesperson responded that the Government was “taking a strategic look at options for the State Administration Centre precinct (SAC)” and: “among options, the Department of Treasury and Finance has spoken to Funds SA about the possibility of them acquiring the SAC”.

“Any offer, if made, would be subject to Funds SA’s own independent assessment processes.”

The latest attempted sale was to property developer Commercial & General. The $391 million deal fell through late last year, costing C&G its $5 million deposit.

“The [attempted] sale of the SAC was the subject of a competitive sale process with full legal and probity oversight,” the Government spokesperson said.

“The contracted bidder, Commercial & General, forfeited their $5 million deposit when they failed to settle on the sale in December 2016.”

Property Council of Australia SA executive director Daniel Gannon told InDaily early this afternoon that: “In the event this sale proceeds under this arrangement, the Government must explain whether previous under-bidders have been offered the same opportunity to consider purchasing this prime site.”

 “If not, we need answers as to why the private sector has been overlooked for this investment.

“The property sector firmly believes that South Australia’s economic future lies in competitive free market investments in the right tax and regulation environment.”

But the Government spokesperson reiterated that “No offer has been made by Funds SA”.

“Funds SA is one option the Department is considering but no decision has been made on the sale of SAC.”

Earlier, the spokesperson said that since C&G sale fell through, the Government had removed its 24 Flinders Street office building from the SAC sale package, placing the property on the market for separate sale.

A previous attempted sale, to Finance Mutual Australia for $220 million, fell flat in 2015.

If Funds SA did purchase the building, according to spokesperson, “the only effect on the budget would relate to the final sale price”.

“Funds SA is an independent authority with revenue streams that are separate from Government,” the spokesperson said.

Any decision on the SAC would have to be approved by the Cabinet.

InDaily asked Foley this week whether he was aware of any request from the Government for Funds SA to purchase the building, but he declined to comment.

Funds SA invests funds on behalf of South Australia’s public sector superannuation funds.

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