Brisbane ratepayers are not well served by having their Council involved in property development through the City of Brisbane Investment Corporation (CBIC), with its latest proposed development at East Brisbane suggesting it isn’t meeting important economic or social objectives (see Croquet Club threatened by development).
I’d prefer the Council to simply sell off land it no longer requires rather than to become a property developer and to expose ratepayers to commercial risks, which are heightened due to the Council’s inexperience. So, from an economic perspective, simply selling off the land would be preferable.
While the CBIC appears to have a social as well as an economic mandate, by attempting to achieve self-funding community projects, the fund doesn’t appear to be doing well on its social mandate either. In this case, the community group that is supposed to benefit from the project, the local Croquet club, doesn’t want it because the development will be a huge disruption to members and will deny them a revenue stream from renting out club rooms that will lose their valuable river views when the apartment towers are built.
I’m not suggesting that a prime riverside site such as this one should remain undeveloped for the benefit of a Croquet club, but I think this example demonstrates a risk with trying to mix economic and social outcomes in the one development. You can end up with a development that does a poor job in meeting either economic or social objectives.
The Council should launch an independent review into the performance and future of the CBIC. The fund has previously received significant criticism for its performance (Brisbane City Council ‘future fund’ under fire despite multi-million dollar profit) and this latest blunder raises further concerns about the fund’s desirability.