Sunnybrae Estate – Request by tenant for extension of lease term

The tenant of Sunnybrae Estate, Adelaide Premium Catering Pty Ltd, has requested that it be granted a 21 year lease of the site. The site is Crown Land (owned by the Government of South Australia) which is in the care and control of Council. As the land is Community Land, public consultation in accordance with Council’s Community Engagement Policy is required.

Background

Sunnybrae Estate Function Centre is located at Naweena Road, Regency Park SA. The land is under Council’s care and control. The farm and buildings were originally constructed from 1882-1884 as the headquarters of the Islington Sewerage Farm. Most of the land was sold off in the 1960s and 1970s (now forming the Sunnybrae Industrial Estate, a light industry area) with just the buildings and immediate grounds remaining. That land passed into care and control of Council (then Enfield Council) in 1981 and the buildings were fully restored in 1982, mainly with grant money. In 1982 the land was declared a Historic Conservation and Recreation Zone. In 1986 the function centre business was established.

The current lease began on 1 July 1999 and will expire on 30 June 2020. The original tenant was Pace Pave Pty Ltd. Mr Semola, the director of Pace Pave Pty Ltd, passed away in July 2013 and the business entered significant difficulty thereafter. Administrators were appointed in March 2014. The business of Pace Pave Pty Ltd was sold to the current tenant, Adelaide Premium Catering Pty Ltd, on 10 April 2014 with the lease assigned (with the consent of Council) on 23 January 2015.

Adelaide Premium Catering has requested that Council grant to it a new lease for a term of 42 years in order to provide security for planned investment.

Issues

Council administration accepts that a function centre business needs long term certainty to allow investment, and also because bookings will often be taken far in advance for events such as weddings.
However, balanced against that are considerations such as whether the future may present other opportunities for the land, and the lack of strategic agility involved in having land tied up for long periods of time.

At present, Council has no other use for the land foreshadowed in strategic plans and a commercial lease seems to be the best use of the land.

The grounds are significant and there are a number of heritage buildings on the site which all require maintenance. At present the tenant takes care of everyday maintenance and the Council is responsible only for capital expenditure.
The land is Crown Land (that is, land owned by the State Government) which has been dedicated to Council. Council effectively has control of the land subject to the Crown Land Act.

Ministerial Permission from the Minister for the Environment would be required before the lease could be granted.

Documents detailing the tenant’s proposal are available below.

Attachments

Tell Us What You Think?

Any enquiries or feedback can be emailed to kym.jackson@portenf.sa.gov.au by 5:00pm Wednesday 31 May 2017.

For further information on this topic, or if you have any questions, please call our helpful Customer Services team on 8405 6600 or email us at service@cityofpae.sa.gov.au.
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