NSW Overpays for Six-Hectare Contaminated Land

A six-hectare toxic site near Parramatta, a developer and the New South Wales government are at the centre of another questionable land deal, prompting calls for referral to the anti-corruption watchdog.

The land in question is a 6.2-hectare site in Camellia, and the state government’s purchase of the highly-contaminated land pegged for the use of its major infrastructure project—the Parramatta Light Rail project—as revealed in a joint investigation by The Sydney Morning Herald and ABC TV’s 7.30 program.

The land deal also reveals a seemingly recurring problem in which the government is overpaying for blocks of land.

Rewind to 2015, when the NSW government originally planned to buy the Camellia site, but forced the then-owner to clean up the site, which was known to be contaminated.

Development and construction company Billbergia then purchased the six-hectare site in late 2015 for $38 million, shortly before the Light Rail project was announced.

Billbergia, an Australian development and construction company founded in 1988 by brothers John and Bill Kinsella, has been a major landowner in the suburb since 2008.

▲6 Grand Avenue in Camellia
▲ The site at 6 Grand Avenue in Camellia.

By April 2016, Transport NSW recommended that the government compulsorily acquire the site from Billbergia, but following an “out of session” meeting, both parties agreed to the site's sale, the joint investigation revealed.

Excluding costs, it was a move that would see the developer make around $15 million on the property flip—in the space of a few months.

The NSW government agreed to buy the land for $53.5 million, triple the NSW valuer general’s $15.5 million evaluation of the site.

The hefty sale price also did not include the remediation of the land.

This poor use of taxpayer cash follows the Leppington triangle land purchase, which saw the federal government buy a block of land near the Western Sydney airport for $30 million which afterwards was valued at just $3 million—a case currently under federal police investigation.

But what adds to this pricey problem is the fact that the state government, and ultimately taxpayers, would wear the cost of the site’s remediation.

▲ The 12-kilometre, $2.4 billion Parramatta Light Rail will connect Westmead to Carlingford via the Parramatta CBD and Camellia
▲ Plans for the 12-kilometre Parramatta Light Rail, to connect Westmead to Carlingford via the Parramatta CBD and Camellia.

The 6 Grand Avenue, Camellia site has a long industrial history, having previously been used for a variety of industrial and chemical manufacturing dating back to the 1930s.

The site has been contaminated by substances including chromium (from the manufacture and storage of chrome products); chlorinated hydrocarbons from the manufacture and storage of chlorofluorocarbons (refrigerants) and asbestos from former buildings and landfilling activities.

The most prevalent of the chemicals in the groundwater and soil is chromium 6 (hexavalent chromium), a proven carcinogen, and the principal toxin made famous by legal clerk-turned-activist Erin Brockovich.

Costs to clean the site have been estimated to range anywhere from between $100 million to $200 million, according to former ICAC counsel Geoffrey Watson, and as high as $700 million, state Labor MP Daniel Mookhey told the7.30 program.

Ventia was engaged by Transport for NSW to complete the remediation work which started in March 2019.

A transport document leaked to the ABC's 7.30 has since found the land as “worthless”, valued at negative $3 million to $7 million dollars, according to PWC.

“At face value, there are sufficient questions there that need to be answered,” Berejiklian said of the state’s land acquisition.

When contacted by The Urban Developer, transport minister Andrew Constance said he had written to the NSW Auditor-General seeking an independent review of the matter.

“I expect full openness, transparency and accountability from Transport for NSW,” he said.

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Article originally posted at: https://www.theurbandeveloper.com/articles/nsw-overpays-for-six-hectare-contaminated-land-parramatta-light-rail-