Negotiations over the Glebe Park block at the centre of a parliamentary investigation had been completed with “a couple of telephone calls and a meeting”, property owner Graham Potts told a parliamentary inquiry on Friday.
“I wouldn’t call it a hard-fought negotiation. There was a couple of telephone calls and a meeting,” Mr Potts said in answers to questions about the government’s 2015 purchase of his land for $3.8 million in circumstances the ACT auditor-general has described as poorly justified.
Mr Potts said he had been approached by the government in 2014 with a valuation of less than $1 million and had rejected it as nowhere near the right price. The next contact was from Colliers head Paul Powderly in 2015, inviting him to a meeting on June 19. At that meeting the Land Development Agency’s Dan Stewart had opened the negotiation with an offer of $3 million.
“I said no we’re not interested in $3 million. It’s not anything near what it was worth, and I came back and said something like ‘it’s worth closer to $5 million’. He said ‘we can’t go that far … what would you entertain?’ I said … ‘I could talk to the other owners at about $4 million’.”
The next day he had a call from Mr Stewart saying “the government have come back, he, the government or whoever has come back” at $3.6 million. Mr Potts said he suggested $4 million, to which Mr Stewart said $3.8 million. He had agreed on the basis of a quick exchange and settlement. The price was “fair and reasonable”, he said.
The block was owned by Mr Potts, Barry Morris, Richard Tindale and Joe Bisa, originally part of a bigger block that was used to build the 188-unit Glebe Park residences. Mr Potts also developed the 330-apartment Manhattan on the Park apartments on an adjacent piece of land.
The Liberals have suggested the government moved to a quick purchase of the block in 2015 because the casino wanted to use part of it for an expansion.
The casino owners presented their plans to the government, including Chief Minister Andrew Barr, in May 2015; the meeting with Mr Potts to negotiate the price was about four weeks later. But Land Development Agency executives have said the quick purchase followed a government decision to move the stormwater pond on Parkes Way ahead of a bid to Infrastructure Australia to lower the road. Progress on that plan is unclear.
Mr Potts said he gave no thought to the reasons why the government wanted the block. “Don’t know, don’t care,” he said. “I didn’t think they were desperate. Someone approached me and there was what I call argy-bargy on the price … I wouldn’t have called anything that was done evidence of desperation. If there was desperation most probably I would have sensed that and I might have got $4 million or a little bit more.”
He and the other owners knew the block would bring “real challenges” if they tried to redevelop it, given the location, so something had to be done with it.
Under the original lease with the government, the owners were to spend at least $1 million building a “parkland”, including kiosks, carparks, shelters and public toilets, with the work to start within a year and finish within three years. Valuers Opteon told the government in 2014 that it was not clear whether that lease requirement had been met, with some parkland works apparently done but no available record of spending.
In 2011, Mr Corbell was asked about the lack of landscaping. He responded that it had been made “very clear to the leaseholder” that it expected the work to be done.
Mr Potts said this week he had met the lease obligations. “We did what we had to do.”
Asked whether anyone had threatened to compulsorily acquire the block given it was needed for a stormwater pond, he said “someone” had mentioned the possibility, and his feeling was he would be paid the value of the land in any case, so “bring it on, compulsory acquisition or purchase, it’ll go down the same track, so I never thought too much about it”.
Mr Potts said he had never discussed the block with Mr Barr or other ministers.