Crown Resorts wins legal stoush over Barangaroo views
Billionaire James Packer’s plans for an iconic casino, hotel and apartment tower at Sydney’s harbourside Barangaroo have received a major boost with his Crown Resorts winning a long running court battle against the authority overseeing the area.
Crown Resorts and developer Lendlease had gone to court seeking to ensure that their sightlines from the Sydney Harbour Bridge to Sydney Opera House were maintained and argued that the authority had not acted in good faith in negotiations.
The pair had feared that allowing the development of high towers at the adjacent Central Barangaroo, a $5 billion precinct being led by Grocon and backed by Aqualand and Scentre Group, could significantly block views from their projects.
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SupCt declares that the Barangaroo Delivery Authority breached the development agreements between it, Crown, and Lendlease by failing to negotiate with them in good faith before considering and approving a bid by Grocon. Sum: https://t.co/yo02ivLMap
— NSW Supreme Court (@NSWSupCt) December 13, 2018
The ruling in the New South Wales Supreme Court, by justice Robert McDougall, held that the NSW government’s Barangaroo Development Authority had breached development agreements with Crown and Lendlease.
The court held the authority was in breach because it had considered various bids to develop Central Barangaroo without first discussing and negotiating with Crown and Lendlease, ways to retain the sight lines their buildings would otherwise have from the Sydney Harbour Bridge to the Opera House.
James Packer. Picture: Getty
Grocon won a preferred position on the Central precinct in 2016 and Crown and Lendlease in August this year launched legal proceedings seeking orders that the authority be restrained from proceeding with the Grocon bids until it engaged in good faith with discussions and negotiations with them and also put up a proposal to them that allowed for the retention of the sight lines.
The legal action came after extensive back room negotiations that were overseen by players including Mr Packer and Lendlease’s then David Crawford-led board. Despite lobbying, NSW premier NSW Premier Gladys Berejiklian declined to intervene in the dispute.
The court held that the purpose of the sight line clauses that Crown and Lendlease relied on was to give them a seat at the table, enabling negotiations as to how the development of Central Barangaroo should proceed.
The judgement said that postponing the negotiations until the very end — when a formal application for planning approval was to be lodged — would “largely eliminate” the benefits of good faith negotiations because by that point the authority would have closed its mind to alternative proposals.
LendLease CEO Steve McCann. John Feder/The Australian.
Crown and Lendlease said that although the retention of sight lines was not guaranteed, negotiations must start from the position of retaining them and the court agreed with this argument.
The authority was found not to have started from this position and the judge declared that it had breached its obligations.
The ruling will likely tilt the balance in favour of Crown and Lendlease in any future talks with the authority.
This could see Grocon’s planned precinct reworked, as it now must accommodate the demands of partners Aqualand and office investor, Oxford Properties Group, while the authority deals with Crown and Lendlease’s calls for lower buildings on its site.
This article originally appeared on www.theaustralian.com.au/property.
