strategy and project development committee

MINUTES

Strategy and Project Development Committee

Monday, 8 August 2016, 6.00pm

TABLE OF CONTENTS

ITEM NO SUBJECT PAGE

REPORTS BY OFFICERS (COUNCIL DECISION) 3

SPD1608-4 FUTURE OF FREMANTLE PORT 3

SPD1608-5 PERTH FREIGHT LINK UPDATE REPORT 7

SPD1608-1 KINGS SQUARE UPDATE REPORT 10

SPD1608-2 FREMANTLE OVAL REDEVELOPMENT 15

SPD1608-3 INFORMATION REPORT - NEW OPERATIONS CENTRE 18

SPD1608-6 BOUNDARY REFORM UPDATE - AUGUST 2016 22

SPD1608-7 KNUTSFORD ST DEPOT SITE REDEVELOPMENT 25

SPD1608-8 PROGRESS ON DEVELOPMENT OF 2 POINT STREET, FREMANTLE 28

CONFIDENTIAL MATTERS 33

CLOSURE OF MEETING 33

MINUTES ATTACHMENTS 1

Minutes – Strategy and Project Development Committee 8 August 2016

STRATEGY AND PROJECT DEVELOPMENT COMMITTEE

Minutes of the Strategy and Project Development Meeting held in the Council Chambers, Fremantle City Council

on 8 August 2016 at 6.00 pm. DECLARATION OF OPENING / ANNOUNCEMENT OF VISITORS The Deputy Presiding Member declared the meeting open at 6.02 pm. NYOONGAR ACKNOWLEDGEMENT STATEMENT "We acknowledge this land that we meet on today is part of the traditional lands of the Nyoongar people and that we respect their spiritual relationship with their country. We also acknowledge the Nyoongar people as the custodians of the greater Fremantle/Walyalup area and that their cultural and heritage beliefs are still important to the living Nyoongar people today." IN ATTENDANCE Dr Brad Pettitt Mayor Cr Doug Thompson Deputy presiding member / North Ward Cr Bryn Jones North Ward Cr Dave Coggin East Ward Cr Ingrid Waltham East Ward Cr Sam Wainwright Hilton Ward Cr Jeff McDonald Hilton Ward Cr Jon Strachan South Ward Cr David Hume Beaconsfield Ward Mr Philip St John Chief Executive Officer Mr Glen Dougall Director City Business Mr Paul Trotman Director Strategic Planning & Projects Mr Graham Tattersall Director Infrastructure & Project Delivery Mr Paul Garbett Manager Strategic Planning Mr Russell Kingdom Kings Square Project Director Ms Louise Ainsworth Senior Strategic Projects Officer Mrs Kayla Beall Minute Secretary APOLOGIES Cr Simon Naber Cr Andrew Sullivan

Page 1


LEAVE OF ABSENCE Cr Rachel Pemberton RESPONSE TO PREVIOUS PUBLIC QUESTIONS TAKEN ON NOTICE Nil PUBLIC QUESTION TIME Nil DISCLOSURES OF INTEREST BY MEMBERS Cr D Coggin declared a financial interest in item number SPD1608-2. PETITIONS / DEPUTATIONS / PRESENTATIONS Nil CONFIRMATION OF MINUTES MOVED: Cr D Hume That the minutes of the Strategy and Project Development Committee dated 27 July 2016 as listed in the Council agenda dated 13 July 2016 be confirmed as a true and accurate record. CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

TABLED DOCUMENTS Nil

Page 2


REPORTS BY OFFICERS (COUNCIL DECISION) Cr I Waltham MOVED en bloc recommendations numbered SPD1608-4 and SPD1608-5. SECONDED: Mayor, Brad Pettitt CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

The following item number SPD1608-4 was MOVED and carried en bloc. SPD1608-4 FUTURE OF FREMANTLE PORT ECM Reference: 165/012 Disclosure of Interest: Nil Meeting Date: 8 August 2016 Previous Item: C1604-3 Responsible Officer: Director Strategic Planning and Projects Actioning Officer: Senior Project Officer (Transport) Decision Making Authority: Council Agenda Attachments: Attachment 1: Presentation to Fremantle Chamber of

Commerce, June 2016, by Treasurer Dr Nahan MLA EXECUTIVE SUMMARY

Council last considered the Port’s future at its April 2016 meeting at which time it resolved to support the principle of releasing South Quay from any privatisation effort by the State Government to allow the redevelopment for non-port operational purposes. This item is intended to bring EMs up to date and to establish a base for future discussion. BACKGROUND Fremantle Port is the largest container and general cargo port in WA, comprising the Inner Harbour at Fremantle and the Outer Harbour in Kwinana. The Inner Harbour has 7 container berths, 7 common use berths, 2 cruise ship berths and 2 small berths for other ships. The Outer Harbour (at present) comprises of the Kwinana Bulk Terminal, Kwinana Bulk Jetty and 3 private jetties. In May 2015 the WA State Government announced its intention to sell (by long-term lease) the Fremantle Port in order to raise funds. The

Page 3


potential sale of the Fremantle Port has significant long-term strategic implications for the future development of Fremantle. The proposed Fremantle Port Lease Package includes: Commercial assets and operational areas on the northern and southern sides of the Inner Harbour; jetties and associated structures owned by FPA in the Outer Harbour; adjacent land parcels identified in the Kwinana Industrial Area; revenues and associated obligations in relation to Outer Harbour private berths; the opportunity to negotiate for the development of the Outer Harbour when container capacity is required. The proposed Fremantle Port Lease Package excludes: Harbour Master functions retained by residual FPA; existing State Agreement rights and obligations will not be affected by the divestment process; residual FPA will retain oversight of development master planning; western end of Victoria Quay retained by the State. See attachment 1. COMMENT

Key recent actions: • February 2016: Council commissioned MacroPlan Dimasi to undertake an

independent analysis of the economic benefit of redevelopment of South Quay. Key points are: approx. 6.0ha of developable land at South Quay; redevelopment of South Quay has a potential $946 million in benefit for the State.

• April 2016: Council resolved to ‘support the principle of releasing South Quay from

any privatisation effort by the State Government to allow the redevelopment for non-port operational purposes’, to ‘seek to have the Passenger terminal and berths C, D, E, and F quarantined from any sale or lease, and/or the state’s interest in further developing the cruise ship industry and terminus be protected as part of any sale/lease’, ‘seek to have the Victoria Quay Master Plan area modestly expanded to the north-east to ensure the City’s aspirations for the rail station and waterfront connectivity can be realised’ and ‘Request that the State government engage with the Council as a collaborative partner in any redevelopment plans for South Quay.’

• May 2016: The Fremantle Port Assets (Disposal) Bill 2016 was introduced to

Parliament in order to enable the long-term lease (99 year) of Fremantle Port to the private sector. It has yet to be debated in the Legislative Assembly (next sitting is 16 August, 2016; Chamber Documents have yet to be released). The Bill is for ‘An Act to provide for the disposal of the whole or part of any business carried on by, or all or any of the assets or liabilities owned or managed by, the Fremantle Port Authority, and for related purposes.’ The Bill runs to 61 pages and 86 Clauses; there is also a 20 page Explanatory Memorandum.

Page 4


RISK AND OTHER IMPLICATIONS

Emerging issues 1. Uncertainty around whether the privatisation/sale of the port will occur. 2. Uncertainty around the delivery model to be adopted for redevelopment of Victoria

Quay. 3. Uncertainty around redevelopment of South Quay for non-port operational purposes. City officers will continue to monitor these issues, will continue to meet regularly with FPA and will continue to advocate the principle of releasing South Quay from the potential port sale to allow for redevelopment for non-port operational purposes. STRATEGIC AND POLICY IMPLICATIONS

Both South Quay and Victoria Quay are subject to Local Planning Policy 2.3 Fremantle Port Buffer Area Development Guidelines and fall within Area 1. Within Area 1 there is a requirement to control development in order to minimise the following potential impacts: a) ingress of toxic gases in the event of an incident within the Port, b) shattering or flying glass as a consequence of an explosion within the Port, c) noise transmission emanating from the Port, and d) odour. Under LPP2.3 the City does not support the following sensitive uses within Area 1: a) childcare facilities, b) aged persons facilities, c) prisons, d) schools, and e) hospitals. LPP3 does allow the City to support residential uses subject to compliance with: a) built form requirements outlined in the Policy, and b) all other relevant Council policies.

Page 5


OFFICER'S AND COMMITTEE RECOMMENDATION

MOVED: Cr I Waltham The update report of August 2016 on the progress of Future of Fremantle Port is received and noted. SECONDED: Mayor, Brad Pettitt CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

Page 6


The following item number SPD1608-5 was moved and carried en bloc. SPD1608-5 PERTH FREIGHT LINK UPDATE REPORT ECM Reference: 165/006 Disclosure of Interest: Nil Meeting Date: 8 August 2016 Previous Item: SGS1506-3; SPC1505-1 Responsible Officer: Director Strategic Planning and Projects Actioning Officer: Senior Project Officer (Transport) Decision Making Authority: Council Agenda Attachments: Nil EXECUTIVE SUMMARY

Roe 8 is a critical element of the Perth Freight Link (PFL); its environmental approvals were initially quashed but have now been restored by the court of appeal. Main Roads WA have indicated that they will formalise an Alliance Agreement with their preferred proponent for the Roe 8 works in due course, with construction activity to begin subject to the approval of the contractor’s management plans following contract award. Main Roads WA are now turning their attention to Stage 2 of the PFL – the Fremantle Tunnel. How to cross the Swan River into the Port remains unknown. BACKGROUND

In June 2015 the Council adopted a position to not support the State Government proposals for Sections 1 and 2 of the Perth Freight Link (PFL) as currently proposed, due to insufficient planning and inadequate analysis of the implications associated of the current proposal. Since this time, the Council has been calling on the State and federal governments to put the current proposal on hold until further long-term freight planning and better options are developed. COMMENT

Key recent actions: • April 2016 – Prime Minister Turnbull committed an additional $260.8 million in

funding for a tunnel option for Section 2, bringing the budget to $1.9 billion. The ‘Fremantle Tunnel’, as Stage 2 is now known, is proposed as a 3.3km twin 12-metre bore tunnel with two traffic lanes in each direction starting at Winterfold Rd and ending at High St. Main Roads WA set out the “next steps” for the project as: i. Complete procurement process: (a) finalise technical requirements for the

tunnel, including engagement with key stakeholders, (b) confirm the project scope including interchange configurations and (c) award a contract to deliver part, or all, of the project.

ii. Undertake all other project development activities and approvals (concurrently with Step 3).

iii. Undertake environment approvals. iv. Finalise the detailed design of all aspects of the project. v. Commence construction when all approvals are in place.

Page 7


• May 2016 – The Senate inquiry into the PFL recommends that the federal

government withdraw funding for the project, release the business case for the PFL, and undertake analysis of the costs and benefits of investing in a second port at Kwinana (amongst other recommendations). Also in May the State Government appealed the WA Supreme Court decision in regards to Roe 8.

• 17 June – The Treasurer spoke in Fremantle on the sale of Fremantle Port, noting

in his speech that “Perth Freight Link is important for long term container trade growth but is not essential for the transaction in the short term – has greater value in improving general commuter traffic flows.”

• 15 July 2016 – On Roe 8 the Court of Appeal ruled in favour of the State,

overturning the December decision by the Supreme Court. Advocacy groups have indicated that they will continue to challenge the legality of Roe 8; exactly how they will proceed is unclear at this stage. Main Roads WA have indicated that they will formalise an Alliance Agreement with their preferred proponent for the Roe 8 works in due course, with construction activity to begin subject to the approval of the contractor’s Management Plans following contract award. The State Labor Party has said that the matter should be on hold until after the upcoming State election.

• 21 July 2016 – The Administrative Appeals Tribunal ruled that given the scale of

the project, it was in the ‘public interest’ that the Federal Department of Infrastructure and Regional Development release documents pertaining to the planning of the PFL. The documents include communication between the Department and Main Roads WA, along with other planning documentation such as traffic modelling and budgets. The Department may appeal the decision.


Emerging issues • Will the Court of Appeal decision on Roe 8 be appealed? • Will the Administrative Appeals Tribunal decision be appealed? • What relevant information might be found in the Federal Department of

Infrastructure and Regional Development documents and would this change the nature of how Council approaches the issue?

• Where will the proposed tunnel surface near High Street and would there be any impact on projects such as Knutsford Street depot redevelopment?

• How will the PFL be connected into the Port from High Street? In charting a way forward, obtaining the Federal Department of Infrastructure and Regional Development documents are important, as their review may enable a more targeted approach to be taken in considering the Perth Freight Link. In addition information released in this regard may assist in determining how to approach the issue of getting from High Street into the Port. Active engagement in Stage 2 – the Fremantle Tunnel could be sought.

Page 8



MOVED: Cr I Waltham The update report of August 2016 on the progress of Perth Freight Link is received and noted.

SECONDED: Mayor, Brad Pettitt CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

Page 9


SPD1608-1 KINGS SQUARE UPDATE REPORT ECM Reference: 053/004 Disclosure of Interest: Nil Meeting Date: 8 August 2016 Previous Item: C1211-1, C1211-2, C1302-1, PSC1302-27, SGC1408-

17, C1505-1, C1604-4. Responsible Officer: Kings Square Project Director Actioning Officer: Kings Square Project Director Decision Making Authority: Council Agenda Attachments: Nil EXECUTIVE SUMMARY

This Project Update Report on Kings Square Precinct Redevelopment is provided for information to Elected Members. It covers the following subjects:

• Appointment of a project director; • Update on securing a State Government department / office tenant; • Status report on proposed new Civic Administration building; • Design issues regarding Newman Court; • Potential acceleration of project program; • The need to develop a communications plan.

BACKGROUND

Since identifying the Kings Square precinct in 2010 as a priority area for redevelopment, the Council has taken the following proactive steps in advancing this major project:

• Signing of a MOU in 2011 to explore development options with the owners of the Myer building;

• Preparation of a draft Business Plan in 2012 and inviting public comment; • Adoption of a Final Business Plan in February 2013; • Signing of a Project Development Deed (PDD) in May 2013 with Sirona – owner of

the Myer building and prospective developer. • A decision was made in February 2013 to hold an architectural design competition

for the Civic Administration building component of the redevelopment; • Establishment and funding of an independent jury panel for the design

competition; • Appointment of Kerry Hill Architects (KHA) as the winning practice to progress

with design work. In April 2016 the Council granted an extension to the sunset dates set out in the PDD for the Kings Square Precinct Redevelopment to enable additional time to secure a major State Government tenant that, in turn, will provide the economic foundation for the total project to move forward.

Page 10


COMMENT

The following provides a project update of key activities regarding the Kings Square Precinct Redevelopment: Appointment of a Project Director The City of Fremantle has recently appointed a Project Director to the Kings Square Redevelopment to coordinate the project from the City’s side of the partnership with Sirona. This has been, in part, to replace some of the project related activities carried out by the previous Chief Executive Officer. It is also in recognition that the project is entering a phase where a broader and more comprehensive project management approach is required to lead, coordinate and report on critical project activities. Securing an Anchor Office Tenant A key component of the partnership with Sirona is the securing of a major office tenant in the redevelopment plans. Recent reports in the media suggest that the State Government is close to announcing whether a government department will be relocated to Fremantle as part of a decentralisation program, as well as its preferred site for the departmental offices. Sirona has made a significant investment in a bid to secure this potential major office tenant as part of the Kings Square Redevelopment. The pending Government announcement is a critical decision that will, if favourable to the Kings Square site, enable the PDD to proceed to project implementation. New Civic Administration Building Kerry Hill Architects have been engaged to develop the concept plans for the new Council building. Drawings are ready for lodgement for a Development Approval. Concurrent to the design work progressing, the City of Fremantle has lodged an application to the Federal Department of Infrastructure and Regional Development for funding assistance through the National Stronger Regions Fund (NSRF). One of the keys tasks to progress with now is to undertake a full cost review of the current design, working with the architects and an independent quantity surveyor. This will assist with any necessary adjustments to scope and procurement strategies to ensure that the project costs to the City stay within the budget framework of the Business Plan. Newman Court – Vehicular Movements A traffic study report prepared by Opus in November 2015 concluded that Newman Court does not need to be opened to vehicular movement (either one-way or two-way) from a future traffic demand perspective. It essentially recommended little change to the current movement system around Kings Square, however, if limited traffic movements were to be introduced into Newman Court, then a one-way south bound flow would be the preferred option. It is therefore proposed to maintain the current modus operandi of no through traffic in Newman Court. The design of the space will be detailed in such a way that emergency vehicles and deliveries will be provided for, as well as ensuring that a long-term option of opening up the street to general traffic is not ‘designed-out’ as part of the current precinct development. Timing – Accelerating the Overall Program

Page 11


The original assumption of development sequencing in the PDD was based on a split construction program for the Admin Building – involving a temporary relocation to the newly constructed office accommodation on the Queensgate site. This sequencing approach is currently under review with development partner Sirona. In particular, the option of constructing both developments (Admin and Queensgate) concurrently may generate the following benefits:

• Reduced construction costs - based on an early start; no split program for Admin Building; and more attractive package to construction industry by having both sites tendered at the same time.

• All works completed around the same time – providing an improved environment for pedestrian movements; access to buildings; and thus improved attractiveness for potential commercial tenancies.

• Public benefits and reputational advantages in having the completion of the precinct brought forward and delivering the social and economic benefits sooner.

The key challenge will be finding alternative temporary office accommodation for the City of Fremantle and bringing forward the program for the temporary move. The City is currently exploring options with Sirona, who are responsible under the PDD to provide temporary office accommodation, within a set price. Communication A comprehensive communication plan will need to be developed to manage the flow of accurate and timely information to internal and external stakeholders. In particular, the anticipated announcement regarding the relocation of a State Government department to Fremantle will generate significant interest. In anticipation of this, the City is currently drafting various media material. RISK AND OTHER IMPLICATIONS

Emerging issues Nil to Report Financial Nil to Report Legal Nil to Report Operational Nil to Report Organisational Nil to Report

Page 12


STRATEGIC AND POLICY IMPLICATIONS

Nil COMMUNITY ENGAGEMENT

Nil CONCLUSION

Under the PDD, the City of Fremantle is currently committed to working in partnership with Sirona to redevelop the Kings Square Precinct. Essentially, one of the few remaining key barriers to the overall project progressing is with securing a major office tenant. Whilst this matter is being addressed by Sirona, the City of Fremantle is progressing with various activities to advance the overall project, as detailed in this Report. It is anticipated that future update reports will be presented to Elected Members at regular intervals, as well as any key decision-making issues that may require Committee and Council consideration. VOTING AND OTHER SPECIAL REQUIREMENTS

Simple Majority Required. OFFICER'S AND COMMITTEE RECOMMENDATION

MOVED: Cr B Jones The update report of August 2016 on progress of the Kings Square Project is received and noted. SECONDED: Cr D Hume CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

Page 13


Issues Raised:

1. Discussion on traffic circulation around the precinct and Newman Court. 2. Update of Government accommodation process. 3. Budget implications from acceleration of move. 4. Acceleration of move and organisations capacity.

Page 14


At 6.22 pm Cr D Coggin declared a financial interest in item number SPD1608-2 and was absent during discussion and voting of this item. SPD1608-2 FREMANTLE OVAL REDEVELOPMENT ECM Reference: 219/001 Disclosure of Interest: Nil Meeting Date: SPD - 8 August, 2016 Previous Item: Nil Responsible Officer: Director City Business Actioning Officer: Director City Business Decision Making Authority: Council Agenda Attachments: Nil EXECUTIVE SUMMARY

The City adopted the Fremantle Oval redevelopment business case in April 2016. This outlined the potential redevelopment of the oval and the consideration to include the Stan Reilly property into an integrated redevelopment. The intent was to provide for co-location of South and East Fremantle Football Clubs in a WAFL centre of excellence venue as well as an opportunity to share the public space for events with Esplanade Reserve. The next steps in the progress of this project is to undertake master-planning of the site to ascertain development scope and develop a funding plan which will provide greater clarity of the cost and financing of the re-development. BACKGROUND

The business case for the redevelopment of Fremantle Oval was adopted by Council in April, 2016. The business case has also been received by the South and East Fremantle Football Clubs and the Department of Sport and Recreation. The business case was joint funded by the two WAFL clubs, the WA Football Commission, DSR and Fremantle Football Club. The plan provided for a WAFL Centre of excellence that included the co-location of the South and East Fremantle Football Clubs. A project has been approved in the current budget to undertake master planning and cost planning. COMMENT

The City has recently undertaken the appointment of a Project Director with urban planning and project management skills to manage this project. The funding provided for the project is being used to fund the position, as well as other projects for the City. The position commenced in mid- July and therefore is still in the process of developing a work plan, with the emphasis being to commence master planning as soon as possible.

Page 15


Dialogue is ongoing in relation to the exit of the Fremantle Football Club from the facility. The Club’s football operations exit is likely to occur in the first quarter of 2017. The City and Club have been unable to reach agreement on the return of the property to the City at this time but are in discussion with the Club. RISK AND OTHER IMPLICATIONS

Emerging issues The exit of Fremantle Football Club from the site and the provision of the site coming back under the control of the City is a continuing issue. This issue is in process with the Club and City in dialogue. Financial At this time no financial costs beyond the approved project in the 2016/17 budget. Once master planning and the funding plan are complete the full costs and possible timing will be presented for consideration. Legal The City is seeking legal advice in relation to the lease agreement between the City and Fremantle Football Club. Operational The City will commence master planning the site which may also involve consideration of the street frontage along South Terrace between Norfolk/Parry and Wray Avenue. Areas along the boundary of the Fremantle Hospital may also be included. The City is in discussion with State Government in relation to supporting the redevelopment with sale proceeds from the sale of Stan Reilly. Organisational The City has recently appointed a new position to support the master planning and funding model for this project. This position is being funded through the budget allocation to this and other key projects. STRATEGIC AND POLICY IMPLICATIONS

The redevelopment of Fremantle Oval is part of the Freo 2029 Transformational Moves Strategy. COMMUNITY ENGAGEMENT

Nil. CONCLUSION

Nil.

Page 16


VOTING AND OTHER SPECIAL REQUIREMENTS

Simple Majority OFFICER'S AND COMMITTEE RECOMMENDATION

MOVED: Cr D Hume The update report of August 2016 on the progress of the Fremantle Oval redevelopment is received and noted. SECONDED: Mayor, Brad Pettitt CARRIED: 8/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

Issues raised:

1. Questions on legal advice and Councils legal position. 2. Questions on possible Synagogue purchase.

Page 17


Cr D Coggin returned to the meeting at 6.33 pm. SPD1608-3 INFORMATION REPORT - NEW OPERATIONS CENTRE ECM Reference: P14-0248 Disclosure of Interest: Nil Meeting Date: 08 August 2016 Previous Item: NA Responsible Officer: Director Infrastructure and Project Delivery Actioning Officer: Project Manager (City Assets) Decision Making Authority: Committee Agenda Attachments: Attachment 1 – Project Schedule EXECUTIVE SUMMARY

The City Depot will be relocated from its existing location at Knutsford St Fremantle, to a new site at 2 Jones St in O’Connor. Several design options were explored in Financial Year 2015/16 with the Base Option selected during an informal meeting of Elected Members in early June. Key activities completed this period include the development of the base option and engagement of the sub-consultants to design detail these elements. The key activities planned for the next period include compilation of a cost estimate for the Base Option. The Base Option and costings will then be presented to Elected Members during an informal meeting. Once the option is accepted then commencement of development of that option shall be undertaken. A Project Schedule has been developed. Assuming no delays in approval or major redesign of elements occur, shall allow the progress of design development and construction of a Preferred Option. Also in parallel, that funds are available for the Asset construction, programme will be complete September 2017. The Project Budget for Financial Year 2016/17 is $3,000,000 and in line with the programme developed architectural and superintendency along with sub consultants have been engaged to provide professional services for the life of the project. BACKGROUND

The City is planning to relocate its Depot from its existing location at Knutsford St. The current Depot is nearing the end of its usable life and relocation of operations would allow the Knutsford St property to be redeveloped in accordance with Council direction. A new site for the Operations Centre was purchased at 2 Jones St in O’Connor. The site is 18,802 m² with a large street frontage. The site also incorporates a warehouse building with an area of 3,120m² and an office with an area of 721m2 along with a hardstand area of 8,440m². The zoning for the site is Industrial, land area being 1.8802 hectares approximately (4.7 acres). Access to the warehouse is via a number of high clearance

Page 18


roller doors. The warehouse features a high truss with a clear span. The property is security fenced with vehicle access to the site provided by two wide entry gates. In Financial Year 2015/16 the consultants Christou Design were engaged to carry out architectural and superintendency services over the life of the project. A Design Brief was developed drawing on the findings from the City of Fremantle Depot Scoping Study, carried out by Aqumen in 2010, and consultation with depot users. Various design options to develop the site to create a functioning depot were produced based on the Design Brief. These were then costed and the design options and cost estimates presented to the Elected Members during several informal meetings. Approval was received to progress the Base Option to Design Development at an informal meeting of Elected Members in early June. COMMENT

Schedule A Project Schedule has been developed. Assuming no delays in approval or major redesign of elements occur, shall allow the progress of design development and construction of a Preferred Option. Also in parallel, that funds are available for the Asset construction, programme will be complete September 2017. Progress The key activities carried out this period include: • Development of the Base Option • Sub-consultant engagement The key activities planned for next period include: • Cost Estimate for the Base Option • Presentation to Elected Members of Base Option layout and cost estimate • Direction received on the Preferred Option • Commencement of development of the Preferred Option RISK AND OTHER IMPLICATIONS

Key Project Risks Schedule risk. Late completion of Project due to delay in procurement confirmation. Emerging issues • Confirmation of Design Brief. Items and services to be provided at the new

Operations Centre yet to be confirmed (e.g. art storage and archive). New Operations Centre layouts and costings cannot be finalised until resolved.

• Critical to delivery of the schedule is the confirmation of design option that will be presented to an Elected Members at an informal meeting in mid-August 2016.

Page 19


Financial The Project Budget for Financial Year 2016/17 is $3,000,000. Twenty percent of this budget has been committed to architectural/ superintendency and sub consultants to design and implement compliance requirements for the life of the project. Legal Nil Operational Nil Organisational Nil STRATEGIC AND POLICY IMPLICATIONS

Nil COMMUNITY ENGAGEMENT

Nil CONCLUSION

The Project has entered the Design Development phase and is currently on schedule for completion September 2017. VOTING AND OTHER SPECIAL REQUIREMENTS

Not applicable

Page 20


OFFICER'S COMMITTEE RECOMMENDATION

MOVED: Cr D Hume This project update report of August 2016 on the progress of the New Operations Centre be received and noted. SECONDED: Mayor, Brad Pettitt CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

Issues Raised

1. Question on costs/changes 2. Frustration that buildings over original budget estimate - need to bring building

within budget. 3. Potential for revenue from leasing some of Jones Street site and phasing in over

time. 4. Extent of potential resource recovery in the development proposal. 5. Comparison of baseline development costs and other options.

Page 21


SPD1608-6 BOUNDARY REFORM UPDATE - AUGUST 2016 ECM Reference: 098/004 Disclosure of Interest: Nil Meeting Date: SPD - 8 August, 2016 Previous Item: Nil Responsible Officer: Director City Business Actioning Officer: Director City Business Decision Making Authority: Council Agenda Attachments: Nil EXECUTIVE SUMMARY

Update on local government boundary issues facing the City of Fremantle. The Local Government Advisory Board (LGAB) recently received a community proposal to amend the southern boundary of Fremantle to include Hamilton Hill and a portion of North Coogee. BACKGROUND

The State Government Local Government Reform Agenda was withdrawn in March, 2015 by the State Government at the conclusion of referendums in three local governments provided a negative vote for change. At that point all reform proposals were withdrawn from consideration. COMMENT

The LGAB recently received a proposal to extend the southern boundary of the City of Fremantle to include Hamilton Hill and a portion of North Coogee. The public process for that proposal is now open and an item has been presented to Council in July for consideration. That item was deferred for further consideration in August, 2016. RISK AND OTHER IMPLICATIONS

Emerging issues Community proposal for the southern boundary to be amended. Financial At this time no financial costs.

Page 22


Legal Local Government Act 1995 Operational For the City to consider its response to the proposal. Organisational Nil at this time. STRATEGIC AND POLICY IMPLICATIONS

Nil. COMMUNITY ENGAGEMENT

Part of the LGAB process. CONCLUSION

Nil. VOTING AND OTHER SPECIAL REQUIREMENTS

Simple Majority OFFICER'S RECOMMENDATION

MOVED: Mayor, Brad Pettitt The update report of August 2016 on the progress of the local government boundary be received and noted. SECONDED: Cr D Coggin Cr J Strachan MOVED the following alternative recommendation: 1. The City of Fremantle advises the Local Government Advisory Board through a submission, of

it’s support for the proposal lodged by Greater Freo, and: a) Backs up that submission with the extensive work done during the LG reform

process b) Included advice that this submission is consistent with the LGAB determination

during the LG reform process c) Believes that this proposal would increase the Cities capacity to achieve its goal of

Strategic Regional Centre under Directions 2031.

2. Allows due process to proceed by not running a campaign of support for the Greater Freo nomination. The City of Fremantle does not raise an extraordinary budget item for this issue.

3. Commits to accept and work with the LGAB determination on this issue.

Page 23


SECONDED: Cr I Waltham Lost: 4/5 For Against Cr Bryn Jones Cr Jon Strachan Cr Ingrid Waltham Cr Jeff McDonald

Mayor, Brad Pettitt Cr David Hume Cr Sam Wainwright Cr Doug Thompson Cr Dave Coggin

Cr D Hume MOVED the following alternative recommendation: COMMITTEE RECOMMENDATION

1. The City of Fremantle advises the Local Government Advisory Board that the proposal lodged by Greater Freo is consistent with the position that Council and the LGAB took as part of a comprehensive approach to boundary reform.

2. However, the City of Fremantle understands that the Minster has stated that

there will be no boundary reform without the support of impacted Councils. Therefore, Council does not see value in proceeding with this proposal at this time.

3. The City will welcome dialogue with all of its adjoining Councils over

boundary adjustments that might be agreed by both parties. SECONDED: Cr D Coggin CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

Page 24


SPD1608-7 KNUTSFORD ST DEPOT SITE REDEVELOPMENT ECM Reference: 115/076 Disclosure of Interest: nil Meeting Date: 8 August 2016 Previous Item: nil Responsible Officer: Director Strategic Planning and Projects Actioning Officer: Senior Strategic Projects Officer Decision Making Authority: Council Agenda Attachments: nil EXECUTIVE SUMMARY

On 23 March 2016, Council considered the assessment of redevelopment options for the depot site and authorised the CEO to negotiate with LandCorp on a preferred option. The draft/negotiated agreement and a business plan would also be subject to Council approval. The City has commenced negotiations with LandCorp and is on schedule to see execution of a development agreement in mid 2017. BACKGROUND

The City recently completed a business case in which it assessed various options for achieving the vision for development of the Knutsford St depot site. Recognising the City does not have the resources to develop the site alone, part and full disposal options were assessed as well as subdivision and built form options. Both market (ie private sector developers) and LandCorp options were assessed. On 23 March 2016, Council considered the assessment process and outcomes and authorised the CEO to negotiate with LandCorp on a preferred option with the draft/negotiated agreement and a business plan being subject to Council approval. It was agreed that the CEO’s business case working group be continued with revised terms of reference to oversee the negotiations. COMMENT

At a meeting on 29th April 2016, City and LandCorp officers met to discuss a way forward. Officers agreed that negotiations to agree the principles of the development agreement could occur concurrently with a review of planning. In support of negotiations, the CEO working group will need to reconvene in the near future to:

• Explore and define the City’s desired non-financial outcomes for the site (including sustainability, innovation and demonstration) and the broader precinct and then to negotiate and agree:

o principles of development agreement o preferred planning and tenure options o preferred implementation options o appropriate measures and milestones o triggers for land transfer o appropriate valuation methodology o satisfactory financial return to the City

Page 25


o a draft development agreement or joint venture to reflect the negotiated

outcomes above • oversee the preparation of the statutory business plan required to support the

resulting major land transaction.


Emerging issues The planning review associated with preparation of the development agreement carries with it the opportunity to resolve design and street scaping principles for the precinct as a whole. It also allows for review of some of the provisions in the now very dated Knutsford East Structure Plan which are seen to constrain development. These include mandated commercial uses, public open space requirements and allowable heights and densities. A further opportunity is the potential involvement of the project in research to explore consultation practices underwritten by the CRC for Low Carbon Living. A key issue for the CEO working group will be determining and agreeing appropriate valuation assumptions. This will be influenced by desired innovation and development outcomes and balancing these against desired financial outcomes. The group will also need to sanction the methodology and timing of valuations and the City’s Business Plan to support both the preparation of the agreement and the actual land transfer. These need to be considered in view of the likely time lag between execution of the development agreement (which will include the process of transfer and development) and the actual land transfer which would likely not occur until after demolition and clean up. Another unknown is the future of the Perth Freight Link as it is unclear where the proposed tunnel would surface. As it is close to the site this could significantly affect planning and development opportunities in the whole precinct. Financial See emerging issues regarding valuations above. Legal Future contracts required COMMUNITY ENGAGEMENT

See note above regarding engagement of precinct and structure plan landowners re precinct design principles, low carbon living initiatives and review of current structure plan provisions. CONCLUSION

The project is progressing in accordance with its timeline which would see the draft development agreement and business plan come to Council for approval in June 2017, with execution of a development agreement immediately following.

Page 26



MOVED: Cr D Coggin The update report of August 2016 on the progress of the Knutsford Street Depot site redevelopment is received and noted.

SECONDED: Cr D Hume CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

Issues raised:

1. Consider quadruple bottom line 2. Questions about streetscape /urban design 3. Height and density questions and scope for good urban design 4. Comments/options around consolidated parking.

Page 27


SPD1608-8 PROGRESS ON DEVELOPMENT OF 2 POINT STREET, FREMANTLE ECM Reference: 053/003 Disclosure of Interest: Nil Meeting Date: Committee, 8 August 2016 Previous Item: Nil Responsible Officer: Director City Business Actioning Officer: Director City Business Decision Making Authority: Council Agenda Attachments: Nil EXECUTIVE SUMMARY

After a tender process the City of Fremantle approved the sale of 2 Point Street to SKS Land Pty Ltd in December, 2012. The sale provisions included specified times where certain outcomes needed to be completed with the overall timeframe being a completed project within five (5) years. BACKGROUND

The sale was awarded to SKS after a tender process managed by Colliers International. Eight (8) tenders were received and the sale price achieved was $10,000,000. The following development requirements were incorporated as encumbrances on any redevelopment of the property:- 1. A minimum of 15% of the development must be designated for office use. 2. The development must achieve a ’green design’ (Green Star system) rating equivalent (as appropriate to a mixed use development) to at least 5 star, incorporating low energy and water use, on-site energy generation, recycling, roof planting etc. 3. Building wall height to be 14 metres (+/- 0.5 metres) at the site’s frontage to Cantonment Street and parts of Point St and Princess May Park, and 14 metres (+/- 0.5 metres) at the frontage to Adelaide St and parts of Point St and Princess May Park. Maximum building height to be 17 metres with the section(s) of building above the frontage height(s) to be sufficiently set back from the fa ade so as to not be visible from the street(s) adjoining the site. Local Planning Scheme Amendment 49 was adopted by the Council earlier this year and proposes to increase the maximum building heights on the property. Development will be able to be built up to a height of 21 metres, with a potential additional 3.5 metres of building height setback from the building facade. Amendment 49 is currently with the Minister for Planning for approval. The Development would be subject to Council’s usual planning procedures.

Page 28


Plans for Development and Planning Approval The Buyer must: (a) provide the Buyer’s proposed plans for the development of the Property to the Design Advisory Committee at least seven days before the first meeting of the Buyer and the Design Advisory Committee; and (b) in good faith meet with the Design Advisory Committee at least once before the Presentation Date and after that date whenever reasonably requested. The Buyer must give due consideration to the design related feedback of the Design Advisory Committee in finalising its plans for the development and the Planning Application. The Buyer must properly prepare and lodge the Planning Application with the City by not later than the Lodgement Date and pay all application fees. If the Buyer fails to either: (a) give the proposed plans for the development of the Property to the Design Advisory Committee at least seven days before its first meeting; (b) in good faith meet with and present the Buyer’s proposed plans for the development of the Property to the Design Advisory Committee by the Presentation Date; or (c) properly prepare and lodge the Planning Application with the City by the Lodgment Date, then the City may terminate the Contract by giving Notice to the Buyer of termination of the Contract. If the City terminates the Contract in accordance with clause 14.4, the following will apply: (a) the Deposit and the Tender Fee shall forfeit to and become the absolute property of the City; (b) the Contract shall be at an end; and (c) no party will have any Claim against the other arising from the termination, in respect of any matter which arose before the termination. If either: (a) Proposed Amendment 49 in the form actually Gazetted is not acceptable to the City or the Buyer; (b) Proposed Amendment 49 has not been Gazetted within 24 months of the Contract Date; (c) the Design Advisory Committee consider that the Planning Application should not be supported within 80 days after the Planning Application is lodged with the City and the City give Notice of this to the Buyer; (d) the Planning Approval is not acceptable to the Buyer or the Design Advisory Committee (acting reasonably); or (e) the Planning Approval has not been obtained by the Buyer within 90 days after

Page 29


the Planning Application is actually lodged with the City, then either party will be entitled to terminate the Contract by giving Notice to the other of termination of the Contract, provided that: (f) where clause 14.6(a) applies, such Notice of termination can only be given within 21 days of the Gazettal; and (g) where clause 14.6(d) applies, such Notice of termination can only be given within 21 days of the Planning Approval being obtained. If a party terminates the Contract in accordance with clause 14.6, the following will apply: (a) the Deposit must be repaid to the Buyer; (b) the City will be entitled to the interest on the Deposit if clause 14.6(d) or 14.6(e) applies, otherwise the Buyer will be entitled to the accrued interest on the Deposit; the Contract shall be at an end; and no party will have any Claim against the other arising from the termination, except in respect of any matter which arose before the termination. Time for Commencement and Completion of Development Notwithstanding any timeframe set out in the Planning Approval, the Buyer agrees with the Seller to: (a) Commence Construction of the Development within 3 years after receiving the Planning Approval; (b) continue to carry out construction of the Development once it has been commenced; and (c) Complete Construction of the Development within 5 years after receiving the Planning Approval. The Buyer must provide the Seller with quarterly written progress reports in a form and content reasonably required by the Seller outlining the Buyer’s progress towards completing the Development Within a reasonable time of a request to do so, the Buyer must provide the Seller with such evidence, certification and documentation as is required by the Seller to demonstrate the Buyer’s progress towards completing the Development. 15.4 Once Planning Approval has been obtained, the Buyer must not seek to vary the Planning Approval or Development without the prior written consent of the Seller. 17. Seller’s Option to Repurchase

Page 30


Before Commencement of Construction (a) Without prejudice to the Seller’s rights pursuant to General Condition 24, the Seller has, until the commencement of construction, the option to repurchase the Property at the price and in the manner set out below if the Buyer fails to Commence Construction of the Development within the period set out in clause 15. COMMENT

Planning approval was received from JDAP in January, 2014 and therefore SKS has until January, 2017 to commence development and until January 2019 to complete development. In recent communication with SKS they have advised they are in the process of establishing an office over the road from the development to provide a sales office and are currently completing the planning phase of how to manage water (or dewatering) during the construction process. They have been liaising with the City in relation to water management plans over recent weeks. The Mayor and Director City Business met with SKS late 2015 to discuss the progress to construction and were advised the intention to commence in the last quarter of 2016. Recent comments put this into early 2017. RISK AND OTHER IMPLICATIONS

Emerging issues SKS has advised they will soon be opening a sales office in Fremantle (at a site opposite the development site) to commence selling the residential element of the development. Financial Nil. Legal Nil. Operational The City is in discussion with SKS and their contractor in regard to de-watering management issues and planning. The City is currently awaiting formal submission on these matters. Organisational Nil.

Page 31


STRATEGIC AND POLICY IMPLICATIONS

Nil. COMMUNITY ENGAGEMENT

Nil. VOTING AND OTHER SPECIAL REQUIREMENTS

Simple Majority Required OFFICER'S AND COMMITTEE RECOMMENDATION

MOVED: Cr J Strachan The update report of August 2016 on the progress of the development at 2 Point Street, Fremantle is received and noted. SECONDED: Cr B Jones CARRIED: 9/0 For Against Mayor, Brad Pettitt Cr Doug Thompson Cr Bryn Jones Cr Jon Strachan Cr David Hume Cr Dave Coggin Cr Ingrid Waltham Cr Sam Wainwright Cr Jeff McDonald

Issues raised:

1. What is the current progress of the building commencement? 2. Basement carpark de-watering issues. 3. Awareness of proponent's timeframes set in the contracted obligations.

Page 32


CONFIDENTIAL MATTERS Nil. CLOSURE OF MEETING THE PRESIDING MEMBER DECLARED THE MEETING CLOSED AT 7.16 PM.

Page 33


Page 34


Page 35

MINUTES ATTACHMENTS

Strategy and Project Development Committee

Monday, 8 August 2016, 6.00 pm

Minutes Attachments – Strategy and Project Development Committee 8 August 2016

Page 2