Row over depot deal

A ROW has broken out over Fremantle council’s purchase of a new site for its depot, with competing claims over whether it was a dud deal and accusations of political skullduggery.

The council bought the 18,800sqm site three years ago for $7.8 million, with mayor Brad Pettitt saying the council needed a new depot because it’s selling off its current one in Knutsford Street for housing and parcels of land that big rarely come up for sale in O’Connor.

But since then property prices in O’Connor have softened by about 10 per cent and the previous tenant, who paid over $600,000 a year in rent, has moved out.

Critics like Anthony Van Der Wielen from Empire Property Solutions say because the council paid a premium to snag the property just as the mining boom was coming off the boil, it’s paper losses have been magnified while it’s also lost out on two years’ rent and rates.

• Anthony Van Der Wielen: council paid too much for its new depot. Mayor Brad Pettitt: a rare opportunity for the perfect property.


Mr Van Der Wielen carried out an appraisal for the council a couple of weeks ago, and he says while he can’t release its details, it convinced him the council made a poor financial decision.

He helped develop the neighbouring Dulux site into a series of strata-titled factory units, which sold for between $300 and $400 a square metre. He says while the council’s purchase price of $414/sqm already put it above that benchmark, once remediation for contamination and demolition was taken into account, it was in fact even more expensive.

Mr Van Der Wielen says Empire is Fremantle’s only dedicated commercial property specialist, and he reckons he’s got the runs on the board to be able to stand by his appraisal.

But Scott Bailey from Knight Frank’s industrial property section was more sympathetic towards the council, saying he felt the price it paid was fair at the time and criticising the council for not foreseeing the economic downturn was a bit harsh.

Mr Bailey had previously listed the property for six months, but says he lost to Realmark who sold it to the council quickly, a turnaround he says still has him baffled.

But he thinks the council will eventually move out of the site anyway, saying O’Connor’s in transition, with big factories moving out to places like Bibra Lake and the sites being sub-divided into smaller units.

“On that basis it’s a development site; you could put 60 strata units across it and its on the top of the hill and is a good bit of dirt,” Mr Bailey said.

The council recently advertised the property for lease, with Dr Pettitt saying they were looking for a short-term contract for something like container storage.

But in the long-term he says the site’s bigger than what the council needs and they’re looking at hooking up with other councils to use the excess for recycling services, such as a tip shop where salvageable goods can be sold off.

The council’s manager of city business Glen Dougall also waded into the controversy, which is being fuelled by Fremantle Society president John Dowson who described it as a “dumb deal” to members.

Mr Dougall said the site was purchased only after a professional valuation and the wide circulation of a business plan.

“The city is continuing to explore its options around how and when to sell the current operations centre to fund the relocation to a new operations centre,” Mr Dougall said.

“In the meantime the city has decided to lease the Jones Street site to generate additional revenue.”


Mr Dougall says the council believes Mr Van Der Wielen’s appraisal was leaked to mayor candidate Ra Stewart, but she says she’s not seen a copy and the realo says he’s not provided it to anyone. He pointed to a social media stoush he’d had with the mayor over the issue in which he challenges him to release his appraisal publicly.

Mr Dougall says the council’s weighing up its options regarding the leak.


One response to “Row over depot deal

  1. What a surprise Freo council in another dumb business deal

    Who’s the losers again
    The rate payer

    Wake up people Freo needs fresh blood on council, the current one is toxic

    I wonder what other devalued property they have and its reported in the councils financial situation

    Dodgy is as dodgy does

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