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An artist's impression of the new civic buildings, to the right of a redeveloped Myer building.

Council pressed over Kings Square finances

The City of Fremantle has strongly rejected claims by a local ratepayers and residents group that the civic component of Fremantle’s $300 million Kings Square redevelopment will result in a $30 million loss.

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Comments

Hilton
Excellent! About time some pertinent questions were asked about this deal.

Fremantle
Very good article

Fremantle
Fremantle's Kings Square Project financial equation is really simple: The Project costs rate payers A$45 million, and generates A$800,000 in revenue annually. It takes 51 years to recover the original capital costs from the revenue generated by the Project. The Business Plan also states that the building will have a residual value 20 years after development of A$97 million. I thought buildings depreciated over time, and this one has no alternative use - it is a civic centre! The City of Fremantle claims that this adds up to a 6.15% rate of return and a positive A$4.15 million NPV. What??? The City of Fremantle has been asked to explain how it calculates a positive RoR and NPV based on those assumptions. That's all. No trick questions here! Why does it refuse to answer the questions - they are not unreasonable questions, surely? If CEO McKenzie is confident in his calculations, why not share them with us - they have told us that all of the assumptions are in the public domain. Why are the calculations "confidential"? After 8 months of "responses" and not a single answer, does Fremantle CEO McKenzie seriously believe that the residents of Fremantle want yet another "response"? If the Council has nothing to hide, it would have answered the questions in October 2014, when they were first being asked discretely and out of the public domain. Looks like more "responses" and no answers are coming our way again. Have you wondered what additional services and facilities that residents of Fremantle get for their A$45 million? The library doubles in size, and the new toilet block gets a baby change facility. The rest is spent on replacing the existing accommodation for Council staff and our elected Councillors. Excellent!

Nice article thanks Dan, looking forward to here Fremantle CEOs answers

Fremantle
Why ius it that the Fremantle CEO needs to put together a detailed response? Surely a properly constructed business plan should contain all the answers. It would appear then that the plan was not as detailed and comprhensive as claimed. Did the councillors have all the facts and figures to make them capable of understanding fully what they were deciding on?

Fremantle
One would have thought that the CEO would not need to put together a "detailed response ...on how the city and its consultants calcalculated the return...." Any reasonable business plan should have clearly outlined this, suggesting the CEO's confidence in the plan is misplaced. If the business plan is so difficult to comprehend that it requires detailed explanations, were the elected members of council given these detailed explanations prior to voting on the matter? If they were why has it taken the CEO more than 8 months to answer simple questions from ratepayers? The behaviour of the CEO does not add up, something strange is afoot.

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