East West Link tunnel plan leaves no time for businesses

[ A+ ] /[ A- ]

The Age: East West Link tunnel plan leaves no time for businesses. Michael Bleby. August 26, 2014

In a hurry: There is too much to deal with in three months, some say.

Andrew Kelly doesn’t think there’s enough time. The Linking Melbourne Authority wants businesses in the Clifton Hill area it is compulsorily acquiring for the first stage of East West Link works to be out of their premises by August next year.

“They’ve not been unreasonable in terms of the process,” says Kelly, the owner of children’s publisher Wild Dogs Books. “You’re entitled to compensation. What seems unreasonable is the hurry that it’s been done in.”

Kelly is better off than many. As a tenant at his building on Alexandra Parade, one of a number the government body intends to acquire, all he needs to do is lease a new site somewhere else. But for other businesses that own their sites, the formal acquisition process that started with the issuing of formal notices earlier this month is uncomfortably tight.

Having issued formal notices saying it intends to acquire the properties – as it is entitled to do by law – Linking Melbourne Authority intends to issue the formal notices of acquisition in October, after the minimum two months allowed. While the properties formally become property of the government at that point, the owners – who are not forced to vacate at that point – are entitled to a three-month period of negotiation over the value of their properties and business.

This, however, is often not enough time.

“You often can’t do it in the three months,” says Anton Dunhill, a partner of Hunt & Hunt lawyers, who specialises in compulsory acquisitions. “There’s too much preparation and not all the parties can do all they need to in time.”

The October notice of acquisition will be accompanied immediately or within 14 days by a letter of offer detailing what the government will pay for the land and business. Businesses then usually get their own valuers to come up with an alternative valuation and a lot of to-ing and fro-ing then takes place between the owner, the valuers and the authority in charge.

The Linking Melbourne Authority says businesses will have enough time to relocate.

“We know it can take some time for businesses to relocate and that is why Linking Melbourne Authority has been engaging with businesses about this proposed time frame since October last year,” an LMA spokeswoman said.

“At the discretion of the businesses, LMA has been assisting with investigations towards their relocation in the event that the project received planning approval. All of the affected businesses have had this opportunity and have been encouraged to engage legal and other professional advisers to assist them in these investigations. They are also entitled to claim reasonable business disruption costs directly arising from the acquisition.”

The August deadline for dispossession – the date when affected owners have to move out of their properties – is a problem for residents, many of whom face the prospect of moving their children out of schools mid-way through the school year. For businesses, assuming they even reach agreement on the price of their property within three months, it will already be January by the time they decide whether to relocate the business or close it.

“It’s not until you actually get a settlement or closer to a settlement that you know how much money you have and what is best as strategy for the business – whether to close the doors or to try and relocate,” Dunhill says.

Even for a tenant like Kelly, he doesn’t know how long he’ll have to deal with the government as landlord and on what terms he will be dealing with them, if he stays in place until August.

“It’s like – nothing’s happened for ages and then suddenly everything happens in a hurry,” he says. “It’s been difficult to plan and difficult having confidence they will follow through with what they’re saying.”

Leave a Reply

Your email address will not be published. Required fields are marked *