Getting compensation right

IN a an unprecedented move the Heritage Council last month offered to make up a $150,000 profit shortfall to the developer of the controversial Court Hotel project if part of the Beaufort Street building was retained in the planned residential and retail development.

Despite the developer claiming that at least $1.5 million was required to make the project viable, the Heritage Council’s offer signals a shift towards a more conciliatory approach.

Heritage Council’s chairman Patric de Villiers believes that the heritage lobby has to be prepared to discuss costs.

However, Mr de Villiers said he became nervous about the compensation discussion “for obvious reasons”. 

“One of my problems is the idea of whether property values have been impacted and by how much – you just get into snow job economics,” he said.

Mr de Villiers said that, over the long term, there was an overall positive benefit to retaining heritage buildings.

“If I look at the economics of Perth, my hypothesis is that if we can maintain a reasonable proportion [of heritage buildings], say 50 per cent or 60 per cent, and adapt them for modern use, in 30 years’ time overall property values in the central area will be higher than if we bowled them all over,” he said.

Hocking Planning and Architecture consultant Ian Hocking said the gap between the cost of retaining and replacing still had to be recognised.

“The replacement value is always less than the conservation and adaptation cost,” he said.

“The St Georges Cathedral, for example, there was a $2.5 million to $4 million gap.”

According to National Trust chief executive Tom Perrigo, about 95 per cent of Australians care about their heritage.

“And 95 per cent of that 95 per cent are prepared to pay for it to conserve it,” Mr Perrigo said.

He said that there was a failure to articulate clearly the benefits of heritage.

“It is our fault for not getting those benefits clearly articulated and getting to the property developers and saying here is a good argument,” Mr Perrigo said.

Property Council executive director Joe Lenzo said 90 per cent of property rights problems boiled down to compensation.

“At the end of the day if we’re saying that governments are saying – be it Federal, State or local – it is a community good to have heritage, and we agree to that, then why should the single property owner have to bear the costs,” he said.

“Why shouldn’t the community bear the costs?”

Mr Hocking said that an open and accountable right of appeal mechanism was required before compensation was considered.

Mr de Villiers said he would endorse a right-of-appeal process.

“I would have a proper appeal process,” he said.

“I have got on the public record I don’t have a problem with a public appeal process but I want one that is better and faster than the one down the hill at the planning commission.”

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