Who is picking up the tab for the Myer redevelopment?

It seems that an announcement is imminent on the proposed redevelopment of the proposed new Myer store site in Liverpool Street Hobart. While the default position of most mainstream Tasmanian media reporting on such announcements is a gushing up-beat narrative of ‘development’ benefits of jobs and investment, The Hag understands that some questions need to be asked about the financing of the project.

In allowing the public to make an informed judgement on the merits of such deals after all, the disclosure of costs is just as important as extolling benefits. So, a few questions:

• Has the Hobart City Council offered a multi-year deal of direct and indirect financial support for the project worth millions of dollars?

• Have the project developers been offered inducement to proceed with the project such as cut-price rates? If so, how much do the subsidies add up to over the life of the agreement?

• Will the agreement with Myer and the project developers be made public? If not, why not?

• Has a cost-benefit study of the project been done? Will this be made public? If so, when?

• Has the cash-strapped Hodgman Liberal government also pledged financial support for the project? Is it true that the Tasmanian Development Board has offered a multi-million loan to help underwrite the project? If so, why is this project being funded? What are the terms of the agreement? Will the agreement be made public? If so, when? If not, why not? ( ABC Radio is reporting that the Will Hodgman government is pledging $15 million to the project …)

• Has a cost-benefit study of the project been done? Will this be made public?

• Have any of the companies involved in the project been donors to the Liberal Party in the past three years?

• Have any of the companies involved in the project been donors to any Hobart City Council alderman or their election campaign in the past three years?

• Kalis Properties confirms construction targets for exciting new Icon Complex in Hobart

• ARA and Hobart retailers celebrate long-awaited Myer redevelopment

• Mercury: FINALLY … A new Myer store to rise from ashes

• Will Hodgman: Liberal Government Acts to Secure Myer Redevelopment and Revitalise Hobart’s CBD The TDB loan will be provided on commercial terms at no cost to the taxpayer. It will enable Stage 1 construction work on the Liverpool Street site to start this month and I am informed this will be finished and occupied by Myer by Christmas 2015.

• John Hawkins, in Comments: The wife of the Lord Mayor of Hobart Elizabeth Thomas is on the board of RBF: https://secure.superfacts.com/public/rbf/content.tpz?TP=PL_Board&QL=QL_Board RBF is according to its Annual Report self insured (2012-2013 note 18 page 100). If this is so the 18% return on the Myer site turned into a dead loss in 2007 when an uninsured building went up in smoke. This probably accounts for the RBF suing the Tasmanian Fire Service for damages case, later dismissed by the courts. The sale of the derelict site for 16 million to Kalis was yet another expensive RBF disaster along with the airport purchase; this seemingly accident prone board of directors managing a return of approx 2% on members’ funds. Is this another mates’ enclave run to the detriment of Tasmanians?

• John Hawkins, in Comments: The wife of the Lord Mayor, a government appointee to the board of the RBF, is positioned to represent the best interests of Tasmanian public servants and their pension funds at this property developing corporation. The Myer site and Hobart airport therefore come, in part, under her remit. The RBF website states she was appointed 4 Sept 2009 and is by occupation: “an independent business consultant”. As a result of the above I pose the following questions to Mrs Elizabeth Thomas for she provides a thread linking the RBF and through her husband the HCC and through him the purchaser of the site Mr Kalis to whom her board confirmed the sale and to whom the HCC intends to facilitate as yet unknown financial assistance.

• Ald Helen Burnet, in Comments: Comments suggest that most would like to see Myer rebuilt. Of course, Myer is seen as an important tenant in the city, and we wouldn’t want to lose it as an anchor for smaller businesses. But at what cost? Far too much – as yet undisclosed – in my opinion is promised from Hobart City Council. Now a loan which may or may not be re-paid will be made through the Tas Development Board, courtesy of Will Hodgman’s state government. Was the state government aware of the extent of financial assistance to the project from HCC? It wouldn’t surprise me if federal assistance would be asked for: with such a successful strike rate, why not? Questions are raised as to the legitimacy of a project when there is soooo much public money promised to prop it up. Not only have we seen the developer (both Kalis and Myer) be promised funds courtesy of Hobart ratepayers, but the double whammy is that taxpayers will now foot the bill too.

• Will Hodgman, Premier: Growing the economy We will intervene and take action when needed, for example where there is: • An obvious market failure, such as the loss of international shipping; • A strategic investment opportunity, such as the Qantas call centre; or • A clear benefit for the community and the broader economy, such as the Myer redevelopment.