THE HISTORY CHANNEL

Back to that Year of Wonders, 2008

A friend who prefers to remain anonymous has very kindly supplied me with a page from a surveyor’s report concerning the proposed sale of the Old Convent by the Shire of York to Mr. David Lawn in June 2008.

According to my friend, the surveyor in question was none other than the husband of one of the Shire’s more senior clerical employees.  Cosy, huh?

At the time of sale, Mr. Lawn worked as the Shire’s planner.  I believe that in a previous incarnation he had worked in a similar capacity for the Shire of Chittering when Ray Hooper was employed there as CEO.  Presumably, he and CEO Hooper were on collegial, even friendly terms.

I’m told that CEO Hooper decided to handle the sale to Mr. Lawn rather than involve an outside agency.  If so, then with the benefit of hindsight he might since have wished he had put a little more distance between himself and the transaction.

I say that because members of York’s tireless army of whingers, grumblers and naysayers—among whom I have now and then been undeservedly classed— have at various times over succeeding years expressed less than polite dissatisfaction with how CEO Hooper handled the sale, and the fact that he handled it at all. 

Wickedly—how can those people live with themselves!—some  have even gone so far as to allege that favouritism or worse may have played a part in the deal.

One allegation that, sadly, I am in no position to refute is that after the sale had been completed, ratepayers found themselves forking out a considerable sum to pay for the property’s connection to the sewer. 

Questioned as to why this had happened, such connection not having been a condition of the contract of sale, CEO Hooper is alleged to have replied that he had forgotten to include it.

Or so the story goes.  If it’s true, we might wonder what happened on this occasion to the ancient principle of caveat emptor—‘let the buyer look out for his own interests’. 

Happily for Mr. Lawn, it appears that the legendary generosity of York’s ratepayers towards the Shire’s most favoured employees came inexorably into play.

Proceeds of Sale—A Hoary Mystery Resolved (or is it?)

In May 2014, my friend Roma Paton asked at a special council meeting what had become of the proceeds of sale of the Old Convent land and buildings.  In response, then Acting CEO Keeble provided her with extracts from Shire financial records pertaining to the Land and Infrastructure Reserve (LIR).  (See first photo, below.)

Those extracts show—or purport to show—that on 30 June 2008 the sums of $286, 363.24 and $31,818.16, described as ‘PROCEEDS OF SALE OF CONVENT & LAND’, were paid into the LIR.  That’s a total of $318,180.40, presumably the full price of the sale. 

Strangely, though, according to individuals claiming to have investigated the matter, there appears to be no corroborating mention of the sale itself in Shire records regarding the disposition of Shire property in the relevant financial year.  

That may be why a good many people remain unconvinced that everything about the sale was kosher.  Poor record keeping, combined with furtiveness, have unfairly ruined many a sound reputation.

It’s time for the Shire to release a specific and detailed summary of the sale and of associated issues like connection to the sewer.  In fact, it’s very long overdue.

Will it happen?  Not so long as we have vain, foolish, ignorant and unprincipled councillors determined for all the wrong reasons to bury and forget about the past.

More questions—Chalkies revisited

A question that seems to arise whenever the Convent sale comes up in conversation—did the sale price accurately reflect the property’s market value at the time?  If so, where is the evidence to support that view?

I don’t have an answer for that—not yet, anyway.  If you have one, please tell us all about it.

Then what about a more recent transaction—the Shire’s purchase of the Old Convent School, aka Chalkies, in mid-2015?  Did we get value for money there?

Which brings me to the surveyor’s report mentioned at the outset of this article.  (See second photo, below.)

In his list of property sales possibly helpful in determining value, the surveyor refers to the ‘Convent School and chapel heritage character brick building that have been completely refurbished on 2659 m² ‘.

That property changed hands in December 2003 for $247,500.  The Shire bought it 13 years later for $625,000.  That’s a difference of $377,500 or approximately 153%. 

As a rule of thumb, in normal circumstances you might expect a property to double in value over 10 years—other things being equal, which of course they rarely are. 

So in 10 average years, Chalkies should have achieved a value of roughly $495,000.  Add on, say, a further generous $20,000 to cover 3 more average years, and you arrive at $515,000—in my submission, the absolute maximum price the Shire should have paid, assuming that the Shire should have bought the place at all and that circumstances were normal. 

On that basis, the Shire paid about $110,000 over the odds for a property that had been languishing on the market for a couple of years, and in various important respects wasn’t, as building inspectors like to say, ‘up to code’.

However, we are not dealing with normal circumstances here.   While the mining boom was in progress, Western Australia experienced a corresponding lift in property prices.  Since the mining boom collapsed in 2013, property values have seriously declined, even in the metropolitan area but especially in the country. 

For example, I would venture a guess that properties in York across the board have on average declined in value since 2013 by between 30 and 40 percent.  (Somebody, please show me that I’m wrong!)

So let’s say for the sake of argument that Chalkies doubled in value over 10 years—taking it to $495,000 in 2013—then lost 30% of its value over the next couple of years, a reduction of $148,500, leaving a current market value of $347,000.

So I now have to revise my opinion of a few paragraphs ago and say that the Shire should not have paid a cent more than that reduced sum. 

But even that figure takes no account of the poor condition of the property at the time of sale.

So to sum up, the Shire was dudded to the tune of at least $278,000 ($625,000 less $347,000) by James Best, ACEO Graeme Simpson, Local Government Minister Tony Simpson who could have stopped the process simply by sacking Best as soon as he set it going, and of course their ultimate beneficiaries Richard and Nola Bliss.

But who gives the proverbial fleeting aerobatic exchange of bodily fluids?  It’s only ratepayers’ money, after all. 

Footnote:  Faversham House

In the second photo, I have highlighted the sale price of Faversham House in February 2004.  It then stood at $1,070,000.  The current asking price is $2,850,000.

Applying the same rough-and-ready process of calculation used above in relation to Chalkies, how do you rate the vendors’ chances of getting something close to that price?

Bear in mind that the property has undergone significant skillful renovation over the past dozen years, carried out in every particular under the benevolent gaze of local government building inspectors.

And it offers a potentially very lucrative business opportunity.  Hard to pass up, I’d say. Time for me to dust off my chequebook and sell my shares in Woolies.

1.  Proceeds of sale Old Convent 30 June 2008

 

2. Prices at sale in December 2003 and February 2004 respectively of the Old Convent School ('Chalkies') and Faversham House.