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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
2012-06-12 Daily Xml
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LAND MANAGEMENT CORPORATION

323 The Hon. D.G.E. HOOD (14 September 2011) (First Session). Can the Minister for Infrastructure advise how the Government expects developers to compete with the Land Management Corporation in developments such as Playford Alive, where there has been no payment for land, or with AV Jennings at Penfield where there is no payment for the land upfront and only a payment on a per block basis when the land is sold and settled?

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for Tourism, Minister for the Status of Women): The Minister for Transport and Infrastructure has been advised:

The Playford Alive Urban Renewal Project is being developed on land that has been held by the South Australian Government for many years, with its original acquisition at commercial rates. The Land Management Corporation (LMC) is developing the greenfield elements of the project, and on behalf of the Department for Communities and Social Inclusion, project managing the renewal of Housing SA's assets through the renewal suburbs of Smithfield Plains and Davoren Park. In addition to meeting the holding costs associated with the greenfield land, LMC has funded investigations to support rezoning, master planning, community consultation and engagement, economic development and other work to establish and manage the current urban renewal project.

The development deed between Land Management Corporation and AV Jennings at Penfield requires the payment of a significant development fee in addition to an agreed percentage of revenue from the sale of allotments. This arrangement enables the private sector to undertake greenfield development at a time of constrained access from the financial markets to capital to invest in residential development. It is understood that developers have for some time been entering into similar arrangements with private land owners.

Recently, Mr Terry Walsh, Executive Director, Urban Development Institute of Australia South Australia advised that the use of optional financing methods for the purchase of land is favoured by private developers as the options are allowing different developers the opportunity to compete for land in an environment where bank finance is difficult.

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