JOHNSTAFF

Attachment E

Development Options AssessmentThe Ultimo Presence Project

DLN51 I IVE CABINET

PAXON C}

Development Options Assessment — Ultimo Site

Results Overview: Comparison of Planning Scenarios

A Development Options Assessment ("DOA") has been conducted to assess potential development and divestment options for the Ultimo site. The assessment considers the potential value to the State of allowing third-party development on sections of the Ultimo site, whilst retaining a presence on the site for MAAS and general cultural usage.

Planning ParametersTwo sets of planning parameters have been applied.The first is based on current planning restrictions for the site, which limit development to 28m height. The potential development is shown indicatively below.

The second scenario is based on achieving a change in planning conditions for the site, allowing development to 130m height. This height is determined in accordance with advice from the Town Planning Consultant, Ethos Urban, as it is in keeping with new and proposed developments in the area, preserves solar amenity to surrounding open space, and avoids overshadowing of residential development. An indicative development meeting these requirements is shown below.

Ultimo Site DOA: Results Overview

Type of

Current Planning Controls (26m

Revised Planning Controls (130m

Low to

Mediu

Harwood site Wran Site

PAXON GitOUP

Designs under each set of parameters have been produced by Crone Architects. Both scenarios assume that the existing heritage buildings will be retained, making the Wran and Harwood building sites available for development.

Assumptions for AnalysisResults are shown for a range of develop equity returns. Achieving the upper bound of these ranges will be dependent on the developer attributing a low level of risk to achieving the assumptions that underpin the analysis, and hence accepting a lower return on equity. This may be assisted through the State's contracting strategy, particularly by the State carrying approval risk in achieving necessary site development approvals.

It is noted that the capital costing used in the DOA has not been supplied by a Quantity Surveyor. The capital cost assumptions may be tested with a cost planner should a greater level of certainty in regards to likely construction cost, and resulting potential return, be required.For the revised LEP scenario, it is assumed the State will enter into an agreement with a preferred developer through a tender process. This allows the developer to commence planning and pre-sales prior to the release of the final Development Approval. This expedites the process of delivering the development, allowing concurrent construction with the New Museum, and delivers the best value outcome to the State.The results provided below do not consider, at this stage, the cost impact on the remaining museum or cultural presence as a result of the varying development scenarios.Findings

Results are shown for both residential and commercial development, with values provided for individual sites (Harwood and Wran) and the full site. The indicative designs on which these values are based reach maximum height on both site portions, so there is no opportunity to maximise value on one site by reallocating development area.

Table 1: Residential Results

Type of Development Harwood site Wran Site Total Risk Level

Current Planning Controls (26m Height)

L o w t o M e d i u m

Revised Planning Controls (130m Height)

Medium

Table 2: Commercial Results

It can be seen that a residential development yields the greatest divestment value, consistent with the market analysis originally conducted by CBRE.

Ultimo Site DOA: Results Overview

FAXON li It 0

Achieving a return at the higher end of the range shown will be dependent on a developer becoming comfortable with a low level of risk associated with the project, allowing the developer to accept a return on equity at the lower end of typical development returns. The overall final divestment value will also be contingent on the assumptions from the prior real

estate market analysis, cost planning and other inputs remaining valid at the time a transaction is completed.

A mixed-use development would be possible, and would yield a value within the range bounded by the commercial and residential values

for each site shown above.Value Sharing Voluntary Planning AgreementBased on current practices, there may be a requirement for any development option to undertake in a Value Sharing Voluntary Planning Agreement ("VPA") with local council. It is understood that the VPA will be entered into between the State and the local council, affecting the State's overall net return from divestment of the property. The

amount of any payments associated with a VPA are estimated to be 6.5% of the capital improved value of the site, and will only apply to options that exceed current LEP controls.The table below shows the calculated CIV and VPA amounts applicable to a revised LEP planning option.

Table 3: CIV and

Type of Develop

VPA amounts

A summary of results for revised LEP planning options liable to enter a VPA are displayed below.

Table 4: Results inclusive of VPA, Revised LEP .lannin: (130m)

Type of Development

Commercial

ResidentialLevel

Harwood Site

Wran Site

Both Harwood and Wran

For the purposes of this assessment it is assumed that any VPA outcomes would be reinvested into the Ultimo Presence

Project to assist in the realisation of public amenity or benefit from the project.

Ultimo Site DOA: Results Overview

JOHNSTAFF

Attachment

SENSITIVE

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..—Ptime 1

Dol.. Competition 235 thr Thu 3011/17 Thu 6/11/16

Draft Consultant procurment documentation 3 wits Thu 30/11/17 Wed 70/12/17

Revere and 270mve 1 wk Thu 11/12/17 Th. 11/01/18

Issue to market 0 days Thu 11/01/18 Thu 11/01/18

Tender pen. 1 mon Fri 12/01/18 Thu 8/02/18

Review and appoint Consultants 3 veks 379/02/18 Thu 1/03/18

Consultants draft competition brief 2 mons Fri 2/03/18 Thu 26/04/18

Rev. of Competition bred 2 wits Fn 27/04/18 Thu 10/05/18

Consultants arnmend draft cc mpetrtion brief 3 arias Fri 11/05/18 Thu 31/05/18

Review of Competition bred 2 wks Fri 1/06/16 Thu 14/06/16

Consultants ammend and issue final Briefs to market 2 wits Fri 15/06/18 Thu 28/06/18

Design Competition Ea 115 days Thu 30/11/17 Th. 24/05/18

Design Competitition Strategy and Documentation 1g wks Thu 30/11/17 Thu 19/04/18

FOlto market 0 days Thu 19/04/18 Thu 19/04/16

Eel Cbs. 15 days Fri 20/04/18 Thu 10/05/18

Shortiat of tenders to be endorsed by MAAS 2 subs Fri 11/03/18 Thu 24/05/18

Desan Competition issued to Shortlist of Tenderer, 10 wits Fh 29/06/18 Thu 6/09/18

Site inspection for Sho niist Tenderer 2 wits Fri 13/07/18 Thu 26/07/18

Reviver analyin market bids and Public Exhibrton 3 wks Frl 7/09/18 Thu 17/09/18

Announce Winner 1 day Fri 28/09/18 Fri 28/09/18

Interview preforrod tenderer 1 wk Mon 1/1W113 Fri 5/10/16

Negotiate fee and poen. 1 wit Pao n 1/10/18 Fri 5/10/18

PM to Issue Consultant Appointment recommendation report 1 wk M011E00/11 Fri 12/10/18 to CIPM0

CIPMO to reviver and provide Consultant approval 1 wit Mon 15/10/18 Fri 19/10/13

LOA to Consultant 0 days Fri 19/10/1. Fri 19/10711

Commence 51114 Concept Dtvelopmont 0 days Thu 8/11/16 Thu 1011/18

Plum 2 • fler days Man 22/10111 Fri WOWS

Pro)sct 83 dmfa Man npvit m nirownReview and update cormmuncations strategy 5 days Mon 22/10/11 Fri 26/10/18

Motalsation period for consonant team 2 wits Mon 22/10/1. Fri 2/11/18

Develop document register and rev Ow site documents 2 wits Mon 5/11/18 Fri 16/11/18Consultant start up workshop 0 days Fr12/11/18 Fri 2/11/18

Project cornrramicartions strategy meeting 1 wk Mon 5/11/18 FA 9/11/1.

Risk management workshop 1 wk Mon 12/11/18 Fri 16/11/18

Cornprehenslyesite assessment 2wks Mon 5/11/18 37 14/11/16

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S. 47. Confims functional briefing approach, and develop baseline 30 days Mon 1.1/01/19 • Fd 1/07/28functional briefs

SS rie, Service Mode Review 2 wits Mon 21/01/19 Fri 1/02/19

56 ar4 Develop functional Brief 2 wks Mon 4/01/19 Fri 15/02/19

57 , Endorsement from MAAS 2 vv. Mon 18/01/19 7141/03/19

S3 .. .,.„-,.. Project lbw Oros, and fonctIonel brief development SO dims • Mona/03/14 Thu 1/06/1.

59 67, Functional 8rief PUG I (ill/ athibition design) 1 wk Mon 4/03/19 Fn 8/03/19

60 n Develop Functional Brief 2 wits Mon 11/03/19 Fri 21/03/19

61 9..1 3017I40141 er,ef 7110 2 1 wit Sat 23/03/13 Thu 28/03/19

62 .4 Donlon Function, Brief 2 yoks Fri 29/01/19 Thu 11/04/19

63 ...1 Prekrninvy Concept Design period and associated Workshoil wks Mon 11/03/19 Thu 28/03/19

64 .0. Options Development 3 yaks Fri 29/03/19 Thu 18/04/19

65 . Cost Plan Reviews 1 wits Fri 19/04/19 Thu 2/05/19

66 a: Functional grief PUG 3 Endorsement of preferred concept 011 wk Fri 3/05/19 Thu 9/06/19

67 , Smini. 9.1,y, cod *id Ingo'. lisonagno n t rivief, • 0$ f 1,,i. • - .: - .,,i i d A 6 /14 i , 2,0,109 .4 'Development of Preferred Concept Option 1 wk Fri 10/05/19 Thu 16/05/19

69 o; Test Fe layouts 1500 2 vets Fri 17/05/19 Thu 30/05/19

70 , Arch ksue Concept Options to PM to review and feedback 1 wk Fri 31/05/19 Thu 6/06/19

71 .M1 Concept Options Workshop 61 1 wk Fri 7/06/19 Thu 13/06/19

72 in Finalise Preferred Concept Option 2 wits Fri 14/06/19 Thu 27/06/19

73 .4 Refine blocking and stacking 1 wk Fri 2./06/19 Thu 4/07/19

73 ..1 Departmenta11200 functional planning layouts 2 wks FO 5/07/19 Thu 1007/19

7 Ar1:11 Issue Concept Options to PM to reriew and feedback 1 wk Fri 19/07/19 Thu 15/07/19

76 , Concept Options Workshop a2 (ine; extv ibltion design) 1 wk Fri 26/07/19 Thu 1/001977 Finalise Concept Dosign 2 vela Fri 2/06/19 Thu 15/08/19

ni 04 Preparation of Concept Design Report 2 vela Fri 16/08/19 Thu 29/08/19

79 s PM review / feedback / report updates 1 wk Fri 30/08/19 Thu 5/09/19

80 b1 finalise Concept Oman Report 2 wks Fri 6/09/19 Thu 19/09/19

II i44, 100% Draft Concept Design Report Issue 0 days Thu 19/09/19 Thu 19/09/19

a2 v Endorsement to proceed to 50 1 day Fri 20/09/19 Fn 20/09/19

113 or: Scheme& Deslipt .... - .., ,,,,,Ari,•....-- _...:121 days 44. twown 8920/08/20

. .n 5D Test fat 6 wks Mon 23/03/19 Fri 1/11/19

SO UG, Facade, Wayfinding landscaping Signal Milestone 0 days Thu 9/01/70 Thu 9/01/20

SD Consonant Coordination and Documentation ...heron 3 wits Fri 10/01/70 Thu 30/01/20

89 02 Final Version of SO Report Issue 0218 0 days Thu 19/03/20 Thu 19/03/20

90 4,4 Endorsement to proceed to OD 1 day Fri 20/03/10 Fri 10/03/209 OesIgn Dontiocount :,,,,,,,--,--1--. - ..,..._

, s' - .4s , .;:‘, - ......7. Mon Z3i0i20 FrI 21/0020

92 /60 00 User Groups Preparat,on 5 y. Mon 23/03/20 Fn 24/06/2093 ..; PM to review prior to Issue to User Groups 2 wits Mon 27/04/20 Fn 8/05/20

61 a 00 User Groups (3 rounds of UG • 1 Round Contingency) 10 wks Mon 11/05/20 Fn 17/07/20

95 47. 7014 DO 0 days Mon 6/07/20 Mon 6/07/20

96 01 OD Consultant Coordination and DoomentatIon review 6 was Mon 20/07/20 Fri 28/08/20

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Table Office Photocopying Fees

Number of photocopies

Fee charged

21-100 $2

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