❓ Mr. Wyatt questions the selection of Ramtron Australia, a company with minimal capital, for the Karratha Hilton Hotel development and seeks information on public funds spent on the project. The Minister acknowledges the issue and explains LandCorp's due diligence process, but doesn't provide specific details.
AnsweredQoN 696Legislative Assembly
QuestionView source ↗
LANDCORP —
HILTON HOTEL DEVELOPMENT — KARRATHA
696. Mr B.S. WYATT to the
Minister for Lands:
I refer to the government's announcement in 2012 that
a significant investment decision by Hilton would result in a Hilton hotel
being developed in Karratha and the minister's statement on 25 March
2015 that, as a result of his briefings every couple of weeks, he was confident
that the government-chosen proponent Ramtron Australia would land the financing
of the development. Now that the exclusive working period with the proponent
Ramtron has been terminated, I ask —
(1) Why did
the government choose Ramtron Australia, a company with $100 of paid-up capital,
as the preferred proponent over other developers, including the Prendiville
Group, the Precinct Hotel group, Pindan Contracting and Lyons Capital, to
construct the hotel?
(2) How much
public money went into this plan and the preparation of the proposed hotel
site?
HILTON HOTEL DEVELOPMENT — KARRATHA
696. Mr B.S. WYATT to the
Minister for Lands:
I refer to the government's announcement in 2012 that
a significant investment decision by Hilton would result in a Hilton hotel
being developed in Karratha and the minister's statement on 25 March
2015 that, as a result of his briefings every couple of weeks, he was confident
that the government-chosen proponent Ramtron Australia would land the financing
of the development. Now that the exclusive working period with the proponent
Ramtron has been terminated, I ask —
(1) Why did
the government choose Ramtron Australia, a company with $100 of paid-up capital,
as the preferred proponent over other developers, including the Prendiville
Group, the Precinct Hotel group, Pindan Contracting and Lyons Capital, to
construct the hotel?
(2) How much
public money went into this plan and the preparation of the proposed hotel
site?
AnswerView source ↗
(1)–(2)
I thank the member for Victoria Park for the question. For the benefit of those
in the house, the site that the member is talking about is The Quarter site in
Karratha at the end of the main street, right opposite the Pelago development,
which is a project that LandCorp has been involved with and it is developing a number
of office blocks and a range of other community amenities on that site. Part of
the site was reserved for a hotel development and LandCorp, as the manager of
project, went to market and saw interest in a hotel development. Through its
normal market intelligence and due diligence processes, the successful group
that had the preferred run over the site was Ramtron.
Mr B.S. Wyatt : Why Ramtron?
Mr
D.T. REDMAN : The due diligence process was gone through and that was the
assessment process. I do not have all the detail of the assessment, but I have
confidence in LandCorp's processes.
Several members interjected.
Mr
D.T. REDMAN : LandCorp is very skilled at managing those issues. It does it
every day; it is part of its core business.
Several members interjected.
The
SPEAKER : Members!
Mr
D.T. REDMAN : I make the point that LandCorp went through the due diligence
processes that it should have to select the proponents against the criteria
applied to that site. Unfortunately, Ramtron has not been able to raise the
resources that it had hoped to. Interestingly, it is my understanding that
Ramtron is still in the market; it is just that it was not able to do it in the
time frame given. LandCorp sought my advice about how much time to give
Ramtron, and I said that if it had not come to the party, it should not have
the right to carry on; we should open up to market. That is what LandCorp is
doing now, and it is running through that process again. There is interest in
the site. It is a work in progress. We all know that the economics have changed
slightly over the last years, which obviously makes some of those developments
a bit more challenging than they might have been originally, but I am certainly
pleased with the anecdotal feedback that I have got about the interest in the
site since it has gone to market.
Several members interjected.
The
SPEAKER : Members!
Mr
D.T. REDMAN : I do not have the figure of the amount of resources that have
been involved with that, but I am happy to provide that to the member when I
get them.
I thank the member for Victoria Park for the question. For the benefit of those
in the house, the site that the member is talking about is The Quarter site in
Karratha at the end of the main street, right opposite the Pelago development,
which is a project that LandCorp has been involved with and it is developing a number
of office blocks and a range of other community amenities on that site. Part of
the site was reserved for a hotel development and LandCorp, as the manager of
project, went to market and saw interest in a hotel development. Through its
normal market intelligence and due diligence processes, the successful group
that had the preferred run over the site was Ramtron.
Mr B.S. Wyatt : Why Ramtron?
Mr
D.T. REDMAN : The due diligence process was gone through and that was the
assessment process. I do not have all the detail of the assessment, but I have
confidence in LandCorp's processes.
Several members interjected.
Mr
D.T. REDMAN : LandCorp is very skilled at managing those issues. It does it
every day; it is part of its core business.
Several members interjected.
The
SPEAKER : Members!
Mr
D.T. REDMAN : I make the point that LandCorp went through the due diligence
processes that it should have to select the proponents against the criteria
applied to that site. Unfortunately, Ramtron has not been able to raise the
resources that it had hoped to. Interestingly, it is my understanding that
Ramtron is still in the market; it is just that it was not able to do it in the
time frame given. LandCorp sought my advice about how much time to give
Ramtron, and I said that if it had not come to the party, it should not have
the right to carry on; we should open up to market. That is what LandCorp is
doing now, and it is running through that process again. There is interest in
the site. It is a work in progress. We all know that the economics have changed
slightly over the last years, which obviously makes some of those developments
a bit more challenging than they might have been originally, but I am certainly
pleased with the anecdotal feedback that I have got about the interest in the
site since it has gone to market.
Several members interjected.
The
SPEAKER : Members!
Mr
D.T. REDMAN : I do not have the figure of the amount of resources that have
been involved with that, but I am happy to provide that to the member when I
get them.
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