Can NSW state make a compulsory acquisition for 'potential urban plaza'?

Discussion in 'Legal Issues' started by ZenSapphire, 4th Dec, 2019 at 12:42 PM.

Join Australia's most dynamic and respected property investment community
  1. ZenSapphire

    ZenSapphire Well-Known Member

    Joined:
    18th Oct, 2019
    Posts:
    57
    Location:
    Sydney
    Hi PC,

    I'm looking at a couple of properties along the Bankstown to Sydenham metro line.
    A few of the areas are proposed by NSW metro plans as "potential urban plaza".
    1. If I owned this property and metro goes ahead with creating an urban plaza, what happens to my property?
    2. Can the state make a compulsory acquisition?
    3. Does the state typically encourage a developer to buy the land + other land?

    https://www.sydneymetro.info/sites/...Impact Statement Volume 1C Appendices H-I.pdf
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    15,571
    Location:
    Sydney or NSW or Australia
    1 - It may or may not be required for the project. If it is required, then TFNSW may make an offer to purchase prior to compulsory acquisition of the site (it's up to you as to whether you take the offer or risk compulsory acquisition).
    2 - If the land is required for the project, then yes, the authority may compulsorily acquire your land
    3 - Is it in the authority's interest to deal with a particular developer? Is there a conflict of interest? Will this pass ICAC?
     
  3. inertia

    inertia Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    763
    Location:
    Newcastle, NSW
    regarding 3, do they not acquire the disparate lots of land, and then go out to tender with a combined parcel?

    Cheers,
    Inertia
     
  4. ZenSapphire

    ZenSapphire Well-Known Member

    Joined:
    18th Oct, 2019
    Posts:
    57
    Location:
    Sydney
    @Scott No Mates Thanks. What defines whether it is required for the project?

    I can understand say a train station or train tracks being required. I’m not sure how an urban plaza would be required for a project, given it’s mainly open space?

    @inertia this is my understanding of what has happened for some councils as well.
     
  5. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    15,571
    Location:
    Sydney or NSW or Australia
    Open space identified as part of the works is part of the project. It will depend upon whether this is already crown land, roadway, council operational or council community land or private land.
     
  6. ZenSapphire

    ZenSapphire Well-Known Member

    Joined:
    18th Oct, 2019
    Posts:
    57
    Location:
    Sydney
    The properties I'm looking at are private land.
     
  7. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    15,571
    Location:
    Sydney or NSW or Australia
    If they are required for the project, then there is precious little you can do than lob in your claim for compensation under the heads listed under the act. As an investor, there are fewer heads available than to owner occupiers of land. Deriving income from the property is not occupancy by yourself. Good legal and valuation advice is required by specialists in the field and extra due diligence would also be required to ensure that negotiations have not been commenced with vendor.
     
    Archaon likes this.
  8. ZenSapphire

    ZenSapphire Well-Known Member

    Joined:
    18th Oct, 2019
    Posts:
    57
    Location:
    Sydney
    thanks for the insights. Decided too risky for us after taking all of this into account!
     
  9. Thomacino

    Thomacino Active Member

    Joined:
    9th Nov, 2018
    Posts:
    42
    Location:
    Sydney
    I haven’t thoroughly looked over the Sydneham to Bankstown Urban Renewal Corridor Strategy nor familiar with the project so can’t specifically comment re your property or potential property.

    But I can give general advice..

    Your purchase will likely be part of a strata complex, and it will come down to the complex as whole based on votes, not you individually, unless it is a Torrens title, cant quote without address..

    Can the state make a compulsory acquisition? Yes. Absolutely, JTC only applies and comes into effect when the vendor (potentially you) decides to hold out on selling land. Usually, and most cases it is in the best interest of the government to settle mutually with the landowner as substantial costs will be involved for the govt. when JTC is in effect. Now the problem lies when the vendor has unreasonable expectations from the government to outlay above market for your land. Most people are under the misconception that CA is a good/profitable thing.. it isn’t, look at Jax Tyres Thornleigh.. they lost out big due to the NorthConnex.

    Q3 is null as that’s assuming the CA is proceeding..

    Firstly, I would read carefully, or consult a valuer experienced with the heads of compensation.

    ‘S.55 (a) to (f) of the JTC1991’. Read it for your own benefit too..

    Also, the Urban Plaza might be a part of a Masterplan, chances are it is, and forms part of the development, so yes.
     
    ZenSapphire likes this.
  10. ZenSapphire

    ZenSapphire Well-Known Member

    Joined:
    18th Oct, 2019
    Posts:
    57
    Location:
    Sydney
    Thanks @Thomacino! Appreciate the detailed explanation. It is part of the master plan for Marrickville precinct.

    I was researching this one. I reckon it will go for around $1.3m but too much risk on the downside from a CA.
    3 Warburton Street, Marrickville, NSW 2204

    Will have a good read of JTC you referenced for learning.
     
  11. Paul@PFI

    [email protected] Tax Accounting + SMSF Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    10,552
    Location:
    Sydney
    Near the Castle Hill Showgrounds Metro areas of land were affected by this same issue. In time some were released and other had broader rezoning and planning impacts imposed. Others are still limited. Speculators didn't fare well
     
  12. Thomacino

    Thomacino Active Member

    Joined:
    9th Nov, 2018
    Posts:
    42
    Location:
    Sydney
    Hardly detailed.. but appreciate the sentiment.

    Possibly more.. did transact for $1.22 in Oct 2018, vendor might get greedy depending on the crowd turnout and expect more. If you are attending the auction I'd be curious to know what the vendor bid is..

    Pity it doesn't have a car space.. great location thou...