A land deal with the state government over the Tawarri Hot Springs site, which is earmarked for a $25 million revamp, has fallen through as the local council refused to enter a head lease.
The City of Nedlands council has refused to enter a head lease with the state of Western Australia over the Tawarri Hot Springs site, which is earmarked for a $25 million revamp.
The Tawarri Hot Springs site, historically known as Dalkeith Hot Pool, on 120 Esplanade in Dalkeith is a Class A reserve vested to the city for care and control.
A facility on the site known as “The Dome” was built in 1957 and operated as the Tawarri Function Centre until 2018.
The city's officers recommended for Nedlands to enter into a head lease of 21 years, with an additional 21 years as dictated by the state, with the state of WA for the site.
The proposed plan was to then sublease the site to Tawarri Hot Springs Pty Ltd.
However, the council has requested for its chief executive to not proceed with the major land transaction at its special council meeting last night.
“Council … requests the CEO to commence investigation of alternative options for the Tawarri site; with the primary objective being that the Class A Reserve that constitutes the site remains in the full care and control of the city,” the council resolution said.
The council also voted for the chief executive to "promptly notify" Tawarri Hot Springs Pty Ltd and the Department of Planning, Lands and Heritage of its decision.
The city officer's report to council said the city would realise a net financial return of about $16.85 million throughout the lifetime of the arrangements, if the deal proceeded.
Since councillors chose to not support the officer's recommendation, the report said the city would be responsible for several costs.
"There is no doubt the Tawarri project has been an extremely lengthy journey for all stakeholders," the report said.
"Should elected members choose not to support the recommendation as contained within this report, the project would not go ahead and the City would be facing costs of (about) $1.04 million to remediate the carpark and drainage issues and remove the derelict facility.
"In addition, should elected members choose not to support the recommendation as contained within this report, elected members must be aware the following may occur.
"The state of WA may choose to lease the land directly to (Tawarri Hot Springs Pty Ltd) and claim 100 per cent of the rent revenue. In this instance, the City may be able to claim rate revenue only."
An application for a $25 million facelift of the existing Tawarri centre is lodged via the state government's State Development Assessment Unit and will be considered by the WA Planning Commission.
The multi-million dollar proposal includes the development of a day spa, a restaurant or cafe, and public realm and landscape works.