Some of Australia’s most prized and expensive real estate could soon be up for grabs as the Defence Department embarks on a nationwide review of its $30 billion-plus property portfolio.
Set to be announced by Defence Minister Richard Marles on Monday, the real estate audit will consider whether the current property mix – which includes 70 major military bases – is fit for purpose, with a particular focus on bases in high-density urban areas.
Middle Head, with the 10 Terminal buildings in the foreground, the oval to the right and HMAS Penguin behind the oval. Sydney Harbour Federation Trust
Defence owns property in some of the nation’s most sought-after suburbs, including Western Australia’s Campbell Barracks, home of the SAS just above Cottesloe Beach, where Rich Listers including mining magnates Gina Rinehart and Andrew Forrest, and media mogul Kerry Stokes all own a slice of paradise.
It also has HMAS Penguin in Balmoral on Middle Head in Sydney Harbour, which the Navy’s own website makes sound like a realtor’s dream.
“HMAS Penguin is surrounded by beaches and parklands and is within 30 minutes drive of the city centre. Penguin is also close to many sights and sounds of Sydney, including Balmoral and Manly beaches and Taronga Zoo.”
And from the Leeuwin Barracks in Western Australia’s affluent suburb of East Fremantle with its sweeping Swan River views in the West; to Victoria Barracks in Sydney’s well-to-do suburb of Paddington, with its heritage listed Edwardian military buildings to the east, everything in the portfolio is up for review.
Bases no longer fit for purpose could be sold off to developers and converted into residential and commercial real estate, which could have the benefit of boosting supply and easing acute housing shortages across the country.
The Andrews government in Victoria in 2015 championed a sell-off of Defence’s urban property holdings to create more affordable housing, including in suburbs such Watsonia, Broadmeadows and Point Cook. The idea was shot down by the then Coalition government led by Tony Abbott.
Under current holdings Defence is budgeted to spend at least $12.2 billion over the four-year budget forward estimates period alone on sustaining its property holdings.
“Now is the time to ensure the Defence estate meets Australia’s future security needs and allows effective, long-term management and sustainment,” Mr Marles said, adding the audit was a recommendation of the Defence Strategic Review handed to the government this year.
Jan Mason, a former Finance Department boffin and managing director of Defence Housing Australia, and Jim Miller, a former head of infrastructure at Macquarie Bank and chairman of Infrastructure Victoria, will lead the review.
The pair will provide recommendations by year’s end to optimise the Defence estate following a direction of the Albanese government to prioritise investment in Australia’s northern network of bases, ports and barracks.
“Jan Mason and Jim Miller bring the unique blend of skills and experience needed to this audit to ensure our Defence estate meets our strategic circumstances,” Mr Marles said.
“The leads were set an ambitious but necessary task and timeline by the Defence Strategic Review, but I am confident they can deliver this important piece of work.”
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