The victims of WestConnex

Ross Greenwood speaks to Danny Gattone, the co-director of Swadlings timber, which has 65 jobs on the line as compensation for acquired land by RMS for the project leaves them severely out-of-pocket and at risk of losing everything

Introduction: The victims of WestConnex

Ross Greenwood: I want to take you to another story now. This is about New South Wales Government and the building of infrastructure.

In this case the $16.800,0000,000 WestConnex motorway project. That will link up, basically, the City of Sydney with the airport and also with the M4. It’s been the missing piece in the jigsaw puzzle of motorways in Sydney for a long time.

The project is a great idea. It is way overdue. However, along that route in Rozelle which is in inner Sydney a land about a kilometer from the Anzac Bridge. Not too far from the Sydney CBD. There’s a series of properties there. There’s also some homes there, that are going to be taken over as a result of the government requiring the land.

Now, the interesting part of that this is as I sat in court yesterday, The Supreme Court, and listened to part of the argument, it’s actually not needing the land for the route of this particular motorway. It will be a tunnel going through this area.

What it needs is land on the surface to basically store equipment. Also ultimately to, well, maybe even put some exhaust tax in, as well. Some of the sites are prime redevelopment land, there’s no doubt.

Now, one is owned by a company called DESANE, which is a stock market was the property developer. A second one is called Gillespie’s, which is a 50 year old crane company. It leases cranes all around Australia. The other one is a family owned timber business called Swadlings.

Now, the timber and hardware companies Swadlings, they’ve been in the game for more than 100 years. They’ve also got Tari, a very important mill. There are 65 jobs on the line here.

The problem is that they had been offered significantly more for this land by property developers on the prospect of it being rezoned residential. It is prime residential land as compared with what the government came out and gave them or is offering them.

The problem now is if you sought to relocate this business, it will be almost impossible. Given the price that the government is offering. The question is, is it fair?

Danny Gattone is Swadlings timber hardware co director. He’s also I think, I can’t remember, they’re all related out there. He’s a Swadling himself. Let’s get him on line. Good Day, Danny, how are you doing?

Interview with: Danny Gattone, co-director, Swadlings Timber

Danny Gattone: Good evening, Ross, how are you?

Ross Greenwood:  Very very well. This is pretty tough for the family because you’ve been in this game for a long time. This particular site, what did the potential buyer, who was doing it on the condition of rezoning to residential, what were they prepared to pay you?

Danny Gattone:  We had a developer well into the planning and great diligence period well before the RMF made this announcement. He based his developmental on 60 units. That’s 400,000 a site. Which equated it to a $24,000,000 development.

Ross Greenwood:  $24,000,000 development. Okay. What did the State Government come and offer you?

Danny Gattone:  2.94.

Ross Greenwood:  2.94. But are there any relocation costs?

Danny Gattone:  935,000 to relocate the business.

Ross Greenwood:  The government has basically offered you $3.800,000 to relocate your business. For something that somebody else just said, if we can get this rezoned it could be worth $24,000,000.

Danny Gattone:  Correct. Yes. That’s exactly what –.

Ross Greenwood:  Which is a long way shy. Can you find, in your area, because you have got a significant amount of land. Can you find a similar site anywhere within the inner Sydney region, that could actually replace the land to put your business if you wanted to?

Danny Gattone:  We’ve had buyers agents out there looking for well over two years. As soon as the announcement and the sites that were available were beyond their reach, as far as buying them, because they too were recognized as development sites down the track. Hence we’d have to pay development cost industrial land.

Ross Greenwood:  In other words the State Government, even though it is important that the WestConnex motorway project goes through.

The point here is that you cannot relocate your business. You’ve almost got no choice but to close the business. If the government they can’t find you another site, or if it persists with the valuations that it’s given on the land.

Danny Gattone:  That’s right, Ross. We’re committed to relocating. We will want to keep the business going. It’s a longstanding successful family business, we want to keep our staff and keep business going.

We do need a fair and reasonable compensation package in order for us to successfully relocate and take up a long term lease elsewhere. Hopefully close to the city. That again, the sites are very tight not many available, Ross.

Ross Greenwood:  I did make the observation. I was in court yesterday, The Supreme Court, because DESANE, the ASX listed property developer, is in court fighting the roads and maritime service. Inviting the New South Wales Government in regards to this. Are you watching this closely? Are you basically prepared to take your own court action as well?

Danny Gattone:  Look, they’re running their case. We’re virtually committed to relocating. I think it’s inevitable. We realize there’s progress that needs to occur with the motorway. That progress shouldn’t be at the cost of today’s business.

Ross Greenwood:  There is a sneaking suspicion from some that maybe the State Government itself, might take this land, and because it’s not used specifically for the project itself, might use it as a staging area for trucks and equipment. That’s what they’ve said they want the land for.

Once the whole development is finished, or the infrastructure is built and completed, that the State Government itself might turn it into residential land and sell it off at a massive profit.

Danny Gattone:  That’s a distinct possibility, Ross. We don’t know what the outcome will be down the track. The land we’re talking about is very close proximity to the city. It’s land that any developer would love to get their hands on and do something with it because of its location.

Ross Greenwood:  I’ll tell you what’s interesting, do you believe that the Government, because you had residential rezoning applications in before councils and also the State Government. Do you believe there was any effort made to slow down those rezoning applications on the basis that the Government might need this land for what WestConnex?

Danny Gattone:  That’s a curly one, Ross. I wouldn’t put it beyond them. I’ve got no evidence. I would dare say that some departments talked to other department. The developer was well into his planning due diligence and he’s very confident of getting a favorable rezone for our site.

Ross Greenwood:  I’ll tell you what, it’s a really interesting story, this one. I should also make the observation that the Roads and Maritime Service did send me a statement today saying, that they at the project’s completion will return this land as part of ten hit days of open green space. Of course that is the proposal. What happens when you’ve got such valuable land sitting there of those three properties.

Well, as I as, if you’re a finance minister or a Treasurer you might just decide that it might be worthwhile pocketing the cash yourself. Danny Gattone, from Swadling Timber and Hardware co director there, as I say, this is the problem of this type of situation.

Remember that anybody who’s in a key area could have their property compulsorily acquired by State Government. That is really what the Swadling family, Danny Gattone, are fighting about right now. Danny, I appreciate your time here on the program this evening.

Danny Gattone:  Thank you, Ross, and thank you for taking an interest in our fight.


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Interviewed  Tony Shepherd, Former President, Business Council of Australia titled ” How is Australia losing its competitive position? .”

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