HOLDFAST SHORES

173 Dr McFETRIDGE (Morphett) (31 July 2007). How much Land Tax and Stamp Duty has been raised from properties associated with the Holdfast Shores development and what is the percentage return on investment for the Government funding of the development?

The Hon. K.O. FOLEY (Port Adelaide—Deputy Premier, Treasurer, Minister for Industry and Trade, Minister for Federal/State Relations): I am advised that you asked the exact same question in September 2003. The answers were provided to Parliament on 19  February 2004.

Since that time, Stage 2B (the final phase of the Development) has been completed. This stage provides a residential apartment complex and an entertainment precinct. The Platinum Apartment building houses 130 dwellings. The entertainment precinct consists of a 5-storey entertainment building, a retail building and a 2-storey building for the Glenelg Surf Lifesaving Club.

In relation to land tax, I am advised that nothing has changed from the information that was previously provided. That is, that to determine the exact amount of land tax raised since the commencement of the Development is an extremely difficult and resource intensive exercise which would involve identifying and examining the individual circumstances of every owner of each property (i.e. all apartments and marina berths) in the Development since the project began in 1997, whilst also taking into consideration factors such as exemptions, where the owner may be entitled to a principal place of exemption, and the aggregation principles, where the owner may own more than one property in South Australia.

As previously advised, in a report tabled on 15 September 2003, in relation to a inquiry undertaken by the Economic and Finance Committee into, inter alia, the Development's return to Government, it is stated that the increased income in water/sewer rates and land tax associated with the commercial development will total approximately $400,000 per annum.

In relation to stamp duty, based on the initial purchase price of each property sold in Stage 2B, RevenueSA is able to estimate that stamp duty of $6.5 million would have been paid on properties sold within that stage.

This information does not include the stamp duty paid on properties on-sold (where there may have been significant capital gains), any assignments of interests in contracts prior to settlement, or duty payable on mortgages entered into to finance the purchase of property. Nor does the information include stamp duty paid on leases of retail, hotel and entertainment tenancies.

In order to facilitate the development of Holdfast Shores, the construction of Glenelg Harbour and Adelaide Shores Boat Haven were undertaken by the Government for a total cost of $19.4 million.

In February 2001, the former Government approved a variation to the Holdfast Shores Development Agreement that included an estimated final distribution sum of $7.75 million, of which $3.66 million would be payable to the Government. The Holdfast Shores Consortium revised the amount payable to Government to $1.9 million later in 2001, and this amount was included in the forward estimates for 2001-2002.

A better than expected return of $3.82 million has been realised, delivering a 19.7 per cent return to the Government on its investment.

It is noted that the issue of the Development's return to Government has also been broadly discussed in the Economic and Finance Committee's report.