Regional Community, Sport and Recreation Precinct

The proposed revocation of community land status aims to facilitate the development of Council’s flagship project, the Regional Community, Sport and Recreation Precinct (The Precinct).

Following significant investigations and analyses to determine the feasibility of the project, towards the end of 2023 the Council made the decision to explore potential private sector partnership opportunities as a way to balance the financial impact associated with the delivery of such significant community facilities.

A potential partnership was identified through a formal expression of interest process and commercial-in-confidence negotiations are underway. The negotiations aim to set out the terms of any future partnership and define parameters around the delivery of The Precinct with the best interests of the community being paramount.

To make the investment in The Precinct viable, the developer requires a long-term lease (99+ years) which is beyond the term allowed under the current community land classification. To progress negotiations, the Council is seeking feedback from the community on the proposed revocation of the community land classification for a portion of land at Allotment 202 Armstrong Road to enable the potential partner to enter into a longer-term lease and deliver the much-needed community facilities.

City of Victor Harbor Mayor, Dr Moira Jenkins, said the proposal would see only a portion of the site revoked as community land status.

“It is only a portion, just over 30%, of Allotment 202 Armstrong Road, that we are seeking to reclassify. The remaining portion of the site will remain as community land. Under the proposal the Council will also retain ownership of the entire allotment,” said Mayor Jenkins.

“The Council has looked extensively at a range of options to deliver an indoor sport and recreation facility for our community and the partnership opportunity is stacking up to be an appealing option.”

“While the negotiations are still being finalised, an initial draft proposal would see the development of The Precinct for around $40 million. Council’s contribution would be $11.7 million over two years with no further ongoing subsidy. Four multi-purpose courts and gymnastics area, as well as childcare, retail and food and beverage offerings are included.”

“The upfront costs for the proposal are significantly lower than what was estimated for Council to construct and operate the facility itself and includes the addition of much-needed childcare and allied health facilities. All of which could potentially be up and running mid-2026.”

Whenever it is proposed that community land status will be revoked, Council must prepare a report for public consultation/consideration and to provide to the Minister for Local Government.

A Community Land Revocation Report has been prepared in line with the requirements of the Local Government Act 1999, and the Council now invites submission on the proposed revocation.

Submissions must be lodged with Council before 5pm on Tuesday, 11 June 2024.

We are pleased to let you know that following the Expression of Interest process, which attracted strong interest from the private sector, Council and its commercial advisers have identified a potential partnership opportunity to bring The Precinct to fruition.

This is a very exciting milestone and puts us another step closer towards sustainably delivering this region-shaping piece of community infrastructure.

The next phase of the project will see Council enter into commercial-in-confidence negotiations to progress commercial terms that ensure the partnership provides the best outcome for our community. This phase also includes further legal, commercial and prudential due diligence.

The negotiations will take place over the coming months and it is expected we will be in a position to provide an update in April 2024.

We know there are great expectations from many within our community when it comes to delivering The Precinct. Please be assured that The Precinct remains the Council’s top priority major project and the latest decision is an exciting step forward.

We are pleased to advise that Council’s Commercial Advisors, Alinea Group, have launched an Expression of Interest (EOI) seeking proposals from qualified and well-credentialled groups to deliver innovative development and operating solutions for The Precinct.

The EOI will run until 5pm on 16 November 2023, following which proposals will be assessed and considered by Council.

The Information Memorandum prepared to support the EOI process can be viewed on Council’s website.

You will note the Information Memorandum includes a high-level concept plan. This has been included for inspiration only.

Please be assured that the Council continues to work towards the delivery of a diverse and inclusive precinct. The final design will be developed with consideration of community needs and future sustainability.

We will continue to keep you informed as this project progresses with the next update likely to be at the conclusion of the EOI process later this year.

Council has made some decisions in relation to the progression of the Regional Community, Sport and Recreation Precinct (The Precinct) project.

The first being that we will be immediately progressing a market-based expression of interest (EOI) seeking proposals from interested parties to assist deliver / operate the facility. This is similar to a process undertaken by the District Council of Mount Barker for The Summit which sought partnership proposals from the private sector to assist with the delivery of recreation, leisure, sport and entertainment facilities. It also includes an opportunity for local builders to be involved in the delivery through a design and construct method.

Why is Council taking this approach? The cost of such a large piece of community infrastructure would be significant in any economic environment. The volatility of the economy over the past couple of years has certainly amplified this and we have received estimates from professional cost surveyors suggesting an extraordinary cost to bring this project to fruition. Affordability and financial sustainability are the primary considerations of Council in progressing this project, followed by the project driver of addressing community needs. Undertaking an EOI is a way to balance these considerations and ensure we are delivering a facility that provides the best outcome for our whole community (in terms of achieving value for money and addressing gaps in current facility provision).

Soft market testing, undertaken earlier this month, indicates there is interest from the private sector in the project. The EOI is expected to be launched in the next few weeks, with proposals to be considered by Council by the end of the year. This will be the next decision point for the progression of the project.

Also at the recent meeting, the Council made a formal resolution to support administration to apply for relevant funding opportunities as they become available. Following the completion of the EOI process, it is expected that we will be in a better position to put a strong case forward to funding bodies. There are two Commonwealth funding streams that we are positioning the project to align with – Growing Regions and the Regional Precincts and Partnerships Program. There are numerous opportunities to make applications to these programs during 2024.

The latest decisions are significant milestones and are steps forward towards achieving the delivery of this facility. The EOI approach provides a way for the Council to be confident that all options have been explored to deliver the best possible outcomes for our community.

We know there are great expectations from many within our community when it comes to delivering The Precinct. Please be assured that The Precinct remains our highest priority major project. In saying this, it is also important to note that this project will be the single largest piece of community infrastructure that the Council is to deliver. The decisions made will have a far reaching, intergenerational effect and it is important that the appropriate due diligence is undertaken before a shovel hits the ground – though with the latest decisions we are closer to achieving this.

The Precinct remains the Council’s highest priority major project. Acknowledging this, the Council has reaffirmed a proposed budget of $20 million for construction of The Precinct within its draft Long Term Financial Plan which covers a period from 2023/24 to 2032/33. The draft Long Term Financial Plan makes allocations for the project in 2023/24 ($1.07 million for detailed design), and then $20 million for construction in 2024/25 and 2025/26.

This draft plan is currently out for public consultation, and we encourage our community to provide feedback on this plan. To find out more and make a submission visit www.yoursay.victor.sa.gov.au/ltfp-amp-2023.

We understand that there is frustration within the community around the speed at which this project has progressed. However, this will be the single most significant piece of infrastructure that the Council is to deliver, and it is important that the appropriate due diligence is undertaken to ensure we are delivering the best outcomes for the whole community.

In addition to the comprehensive engagements undertaken with stakeholders and the wider community, we have completed several significant investigations and analyses to support the progression of the project and put it in the best position to be successful. This has included further concept design options, needs analysis, economic analysis, financial modelling and revised costings.

External funding is going to be critical to ensure The Precinct is sustainable and financially viable. It is intended that at least $10 million of the total budget is secured from external sources. Council is currently working through a number of elements to put the project in the best position to secure external funding. We are aiming to submit an application to the second round of the Australian Government’s Growing Regions program, whilst continuing to explore other funding opportunities. We have been advised by the Commonwealth that it is expected that round two of the grant program will open in February / March next year.

Council continues to recognise The Precinct as a significant investment for our community and we will continue to investigate all options to bring this project to life in the most cost-effective manner.

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