27/08/2009 - 00:00

Rent row over: council

27/08/2009 - 00:00

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FREMANTLE City Council has confirmed the end of the long-running dispute over rents at Fremantle Markets.

Rent row over: council

FREMANTLE City Council has confirmed the end of the long-running dispute over rents at Fremantle Markets.

Fremantle Council chief executive Graham Mackenzie told WA Business News the council was bound by the decision of an independent auditor's report, which ruled the market's private owners - members of the Murdoch family - were charging fair rents.

"Although the stallholders weren't a party to this review, both Fremantle City Council and the Murdochs agreed to abide by the decision, so it ought to be the end (to the dispute)," Mr Mackenzie said.

He said some councillors had expected the review by property analysts Jones Lang Lasalle would recommend a slight downscaling of rents at the markets.

"The council held the view that the valuation was done without reference to the head lease and operating strategy agreements," Mr Mackenzie said.

"Although they don't explicitly say it, the idea is to maintain a low-cost environment; we think there is a fair implication of that throughout the operating strategy and the operating strategy agreement.

"That was always the intention and we believe that if that document had been there they may have come up with a slightly different rent figure."

The council will receive the Jones Lang Lasalle report at a meeting this week and Mr Mackenzie said he would recommend the full report be made public.

"When we asked for the review we asked for two reports and we did that deliberately because we thought there may be a need to make some reference to commercially confidential information in a full report, so we wanted a brief report which was available for public consumption," Mr Mackenzie said.

"Having now read the full report, as an officer, I don't think there's anything commercially sensitive in there.

"Fremantle Markets might disagree, my view is there is no reason that it shouldn't be made public, but the council will decide that."

Fremantle Council released a short form of the report last month, which confirmed that a valuation commissioned by the directors of Fremantle Markets last November complied with proper valuation methods, and that rent levels were "within the range of fair market values as at the date of the report".

The disagreement centred on a report by property analysts Porter Matthews commissioned by the Fremantle Markets Stallholders Association in April.

The Porter Matthews report compared rental values at the markets to Fremantle CBD rents and other similar markets around the country and concluded that Fremantle's rental structure was significantly higher than any other capital city markets except for Sydney.

To mediate the issue, the City of Fremantle called on a provision in the markets head lease that allows for independent valuation in the case of disagreement.

Earlier this month, Fremantle Markets director Jamie Murdoch told WA Business News he felt vindicated by the independent auditor's decision and was looking forward to focusing his energy on improving the markets

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