Landcom has defended the price point paid for a 900 hectare greenfield site south of Sydney after it was found to be $100 million more than a valuation 12 months earlier.
The NSW government land and property developer agreed to pay $257.5 million for the greenfield site in Wilton, about 80 kilometres south-west of central Sydney, from developer Bradcorp in June last year.
The deal came a year after an independent valuation commissioned by Bradcorp estimated the property’s market value at $155 million.
The valuation, reported by the Sydney Morning Herald, emerged from Bradcorp’s unsuccessful legal action in the Supreme Court of NSW against Chinese property developer Country Garden—now known as Risland Australia—in 2019 over the land.
During proceedings both sides presented separate valuations disputing the land’s worth, with Country Garden’s valuation higher at $240 million.
Bradcorp was ultimately unsuccessful in the proceedings and subsequently, Country Garden Australia decided not to proceed with the purchase.
Landcom, which manages crown land for the NSW government and develops housing projects with a social and economic benefit to the state, said it had purchased the land at market value.
“In early 2020, Landcom obtained two independent valuations for the land and during the Covid-19 pandemic, sought a revaluation to reflect Covid-19 impacts before finalising the transaction,” a Landcom spokesperson told The Urban Developer.
“The revaluation resulted in an 8 per cent reduction in price and the purchase price reflects the independent valuation of the market at the time of purchase.”
Landcom now plans to invest $950 million in the parcel of land in order to prepare it for house and land development that could see upwards of 5,600 lots plotted—10 per cent of which will be offered as affordable.
Landcom will act as master developer for the project, co-ordinating the planning, civil infrastructure, and public amenity works at these sites, while working with local councils and the NSW Department of Planning and Environment.
The developer will also deliver a new interchange to the Hume Highway, major roads with potential connections to adjoining suburbs, local roads, two new school sites and over six hectares of regional open space, neighbourhood and local parks.
Upwards of 360 hectares will be set aside for conservation and an 11 hectare lake.
The concerns about the purchase of the Wilton site by Landcom follows an internal investigation by NSW’s transport department into the controversial purchase of toxic land in western Sydney from Billbergia late last year.
An audit by Transport for NSW found that the NSW government paid three times the estimate by the Valuer-General for highly contaminated land at Camellia, near Parramatta, in 2016.