Perth risks losing $1.85bn World Trade Centre

Perth risks losing $1.85bn World Trade Centre

Mon, 19/02/2018 - 17:05
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WTC Perth

UNIQUE: The proposal’s towers are designed to create an internationally-recognisable landmark in Perth. Image: Woods Bagot.

Perth is in danger of missing out on a $1.85 billion property development and international trade platform as its billionaire backer sweats on a green light from the McGowan government.

The developer behind the World Trade Centre Perth proposal is investing its capital in other offshore locations as it’s kept waiting on a decision over a two-year-old bid to buy a plot of state-owned land in the city’s central business district.

World Trade Centre Holdings Cyprus, an international development platform controlled by Jordanian businessman Ghazi Abu Nahl, lodged an unsolicited bid to purchase a 1.9-hectare plot of land near Perth train station in February 2016.

Buying the state-owned land and combining it with the old Megamart site at 30 Beaufort Street, which Mr Nahl acquired for $50 million, would allow for the development of a 3-hectare World Trade Centre complex.

Designed in Perth by global architecture firm Woods Bagot, the proposal comprised a 75-storey tower alongside a 35-storey building, containing offices, residential and short-stay apartments, a hotel and convention facilities, all designed to stimulate substantial cross-border trade and investment, supported by a network of 330 centres in 91 countries.

In January last year, the Barnett government announced the proposal had progressed to the second stage of the state government’s unsolicited bids process, which allows a proponent to provide specific details to facilitate the Department for Lands’ decision on whether to approve the transaction.

But progress has halted since a change of government in March last year, with Planning Minister Rita Saffioti telling Australia China Business Review cabinet had decided not to proceed to the second stage of the process.

“The decision was made on the basis that the state government is not in a position to fully consider a development at the site due to planning for our key transport policy, METRONET,” Ms Saffioti said.

Australia China Business Review understands the section of METRONET most affected the proposal is the long-awaited Morley-Ellenbrook train line, but the land may also be used for other rail extensions.

Tenders for concept planning of the Morley-Ellenbrook line closed in December but no firm date for the naming of a preferred proponent was announced.

A spokesperson for Ms Saffioti confirmed the Morley-Ellenbrook line remained on track for a construction start next year.

However, World Trade Centre Perth business development manager Neil Kidd told Australia China Business Review communication with the McGowan government had been one-sided, and a January deadline for an update on the bid had come and gone.

Mr Kidd said World Trade Centre Holdings Cyprus controlled 20 licences to create similar developments throughout Africa, the Middle East and China, with a lack of progress in Perth likely to lead the company to deploy its capital elsewhere.

Since September last year, Mr Kidd said World Trade Centre Holdings had made significant progress on a similar project in Fuzhou, Fujian Province, with the first sod turned within five months of submitting the proposal to planning authorities.

“Why focus on Perth if Perth doesn’t want it – that’s the reality of the situation,” Mr Kidd said.

“These things don’t require capital from government, but they require a government to want these things to work and to assist in making them work.”

Mr Kidd said World Trade Centre Holdings was aware the site was constrained by METRONET, but the developer was quite comfortable with the reality that it would have to tailor its design to suit.

However, Mr Kidd said what was not well-understood was that the development was much more than just another high-rise commercial proposal, and many had been distracted by the project’s immense scale, with a 75-storey tower that would become the tallest building in Perth.

Economic modelling submitted to the state government as part of the bid process showed World Trade Centre Perth would contribute around $3 billion to the WA economy during construction, create around 3,000 jobs and result in more than $100 million of recurrent income each year, Mr Kidd said.

“Nobody has engaged in the process with us to understand what it is,” he said.

“The last government finally understood that it’s not a property play, but the reality is, everyone wants to talk about the shoebox, but nobody wants to talk about the shoe.

“Anybody can design a building, anyone can build a building, these things can operate within pre-existing buildings, but it’s what it brings to the table, and the fact that it brings a linkage to WA business to all of the businesses in 330 locations in 91 countries.”

Mr Kidd said the establishment of a World Trade Centre in Perth would also result in substantially closer links with Chinese business, with 46 licences held in China, the most of any country in the world.

By comparison, there are 40 licences to operate World Trade Centre platforms in the United States, the next leading country.

“The Chinese get it, China has embraced it as its business-to-business platform, but we don’t seem to want to get it,” Mr Kidd said.

“Firstly, the government has to show that it actually wants to start something.

“So far, that hasn’t happened – that’s the reality of where we sit today.

“But I’m still hopeful that at some point, somebody in government is going to say ‘hey this is capable of delivering incredibly good things to Western Australia’.”