Catherine Carter |
Tuesday, 30 August 2011 2:30 PM |
The ACT Government has announced that it will soon invite organisations to register their interest in designing and building both the office block proposed for Gungahlin and the one proposed for Civic. (more)
Treasurer Andrew Barr made it clear in his media announcement that the government had originally decided that owning and constructing the building themselves was the way it wanted to go, but, after receiving strong submissions from the Property Council it, will now allow businesses to propose alternatives, through a market testing process.
The property industry has always supported moves to accommodate the ACT public service in better quality office accommodation, but there have been concerns about the delivery model which was originally proposed.
The ACT Government had forecast that the Civic project alone would cost $432 million. A project of that size is extremely significant and very expensive, as well as being the largest infrastructure project ever undertaken by the ACT Government. For these reasons alone it is appropriate that a high degree of scrutiny and independent analysis be undertaken to ensure taxpayers and the community receive significant benefit.
It is in fact highly unusual for governments, including the Commonwealth, to build, own and manage their own office buildings. This is also generally true for large banks, mining companies and other corporations. The reason for this is simple: it is not core business for governments and major companies, and experience has found that the property sector can deliver better, more efficient outcomes.
So, the Treasurer’s announcement reflects a sensible, pragmatic approach to the issue, provided the market testing process is open ended enough to enable proper evaluation of alternative solutions and innovative ideas, and that reasonable timeframes are allowed.
As Canberra is currently experiencing the highest commercial office vacancy rates of all the capital cities, at 13.4 per cent, there may be opportunities in the market for some owners to upgrade and retrofit existing buildings to meet ACT Government accommodation requirements as well.
Catherine Carter |
Tuesday, 30 August 2011 2:30 PM |
