Land and Environment Court New South Wales Medium Neutral Citation: Lendlease (Goldfields Residential) Pty Limited v Valuer General of New South Wales [2025] NSWLEC 1046 Hearing dates: Conciliation Conferences on 1 November and 9 December 2024 Date of orders: 29 January 2025 Decision date: 29 January 2025 Jurisdiction: Class 1 Before: Davidson AC Decision: Proceedings 2024/215070 The Court orders: (1) The appeal is upheld. (2) The value of the whole of the land legally described as Lots 1, 2, 3 and 4 in Deposited Plan 1290500, is amended to $505,340,000 for the valuing year 1 July 2022 pursuant to s 6A of the Valuation of Land Act 1916 and is apportioned pursuant to s 26A of the Valuation of Land Act 1916 in the following manner: Lot Apportionment Land Value Lot 1 (Residential) 85.30% $431,047,677 Lot 2 (Hotel) 12.88% $65,080,545 Lot 3 (Rugby Place) 0.02% $88,712 Lot 4 (Retail) 1.81% $9,123,067 Total 100.00% $505,340,000 Proceedings 2024/274477 The Court orders: (1) The appeal is upheld. (2) The value of the whole of the land legally described as Lots 1, 2, 3 and 4 in Deposited Plan 1290500, is amended to $505,340,000 for the valuing year 1 July 2023 pursuant to s 6A of the Valuation of Land Act 1916 and is apportioned pursuant to s 26A of the Valuation of Land Act 1916 in the following manner: Lot Apportionment Land Value Lot 1 (Residential) 85.30% $431,047,677 Lot 2 (Hotel) 12.88% $65,080,545 Lot 3 (Rugby Place) 0.02% $88,712 Lot 4 (Retail) 1.81% $9,123,067 Total 100.00% $505,340,000 Catchwords: VALUATION APPEAL – land valuer – conciliation conference – agreement between the parties – orders Legislation Cited: Land and Environment Court Act 1979, ss 19, 34 Land Tax Management Act 1956, s 14 Taxation Administration Act 1996 Valuation of Land Act 1916, Pt 4, ss 6A, 14, 26A, 29, 35, 35B, 35C, 37, 38, 39, 40 Sydney Local Environmental Plan 2012 Category: Principal judgment Parties: Lendlease (Goldfields Residential) Pty Limited, (Applicant) Valuer General of New South Wales (First Respondent) Fiveight OCQ No 1 Pty Ltd (Second Respondent) Representation: Counsel: L Johnstone (Applicant) M Carpenter (First Respondent) T Hill (Solicitor for Second Respondent) Solicitors: Mallesons (Applicant) Crown Solicitor of NSW (First Respondent) Ashurst (Second Respondent) File Number(s): 2024/215070 2024/274477 Publication restriction: No Judgment 1. COMMISSIONER: The applicant appeals the Valuer General's Determinations dated 11 April 2024 and 27 May 2024 pursuant to s 37(1) of the Valuation of Land Act 1916 (Valuation Act) in respect of the valuations of the land value of the property legally described as Lots 1 in Deposited Plan 1290500 known as 1 Alfred Street, Sydney NSW 2000 (Subject land). 1. The proceedings fall within Class 3 of the Court's jurisdiction pursuant to s 19(b) of the Land and Environment Court Act 1979 (LEC Act). 2. The statutory power or function to be exercised in determining the proceedings are s 34(3)(a) of the LEC Act and s 40(1)(b) of the Valuation Act. 3. The Applicant appeals the determinations of the Valuer General made on 11 April 2024 and 27 May 2024 in respect of the objections made by the Applicant to the valuations of the land value of the land as of 1 July 2022 and 1 July 2023. Planning Background and Site Features 1. Relevant features of the land are as follows: 1. The land is described as Lot 1 in Deposited Plan 1290500 and is a part of a subdivision of land formerly described as Lot 8 in Deposited Plan 1224258. Lots 1 to 4 in Deposited Plan 1290500 (Parent parcel) were created when the site of a building (under construction at the valuation dates) was subdivided into separate parcels with the value of each of the parcels to be determined as set out in s 26A (1). The First Applicant was the owner of Lots 1 and 3 while the Second Respondent was the owner of Lots 2 and 4. 2. The Parent parcel is located on the northern edge of the Sydney CBD, within the City of Sydney Local Government Area. The site is located on the northern boundary of the "City Core" sector of the Sydney CBD. 3. The Parent parcel has a site area of 4041 square metres. It is bound by Alfred Street to the north, Pitt Street to the east, Rugby Place to the south and George Street to the west. It is located diagonally opposite the Circular Quay rail/train/ferry interchange, in direct line 250 metres northeast of Wynyard railway station and 650 metres north of the Sydney GPO. 4. The Parent parcel is irregular in shape and contains an approximate northern frontage to Alfred Street of 59 metres arc, a 49.18 metre eastern frontage to Pitt Street, a 14.48 metre western frontage to George Street and a part southern frontage of 25.83 metres to Rugby Place. 5. As at the 1 July 2022 valuing year, the Parent parcel had been excavated down to six levels with building works for the development, known as One Circular Quay, commenced primarily to the excavated and ground levels. At the 1 July 2023 valuing year, the Parent parcel contained an extensive excavation comprising six basement levels. 6. For valuing years 1 July 2022 and 1 July 2023, the relevant planning control was Sydney Local Environmental Plan 2012 (Sydney LEP) – Map Reference 14. The Parent parcel was zoned SP5 - Metropolitan Centre, which was also in force at the dates the valuations were made. Valuation objections and appeals 1. The valuation objection and history of the appeal includes: 1. The Respondent issued a Notice of Valuation in accordance with ss 14A and 29(1)(a) of the Valuation Act with a last date to object of 31/10/2023. The issued land value was $445,901,355 (Second Supplementary 2022 Valuation). 2. At the time of the Second Supplementary 2022 Valuation: 3. (a) the Applicant was the owner of Lots 1 and 3 in DP1290500; and 4. (b) the Second Respondent was the owner of Lots 2 and 4 in DP1290500. 5. The Applicant lodged an objection to the issued land value of the Subject land for the 2022 Valuing Year with the First Respondent pursuant to ss 29(3A) and 34 of the Valuation Act on 25 October 2023. 6. On 11 April 2024, pursuant to s 35B of the Valuation Act, the First Respondent partly allowed the Applicant's objection recommending that the issued land value for the Land as at the 2022 Valuing Year be amended to $438,473,580 and issued a Notice of Determination to the Applicant as required by s 35C of the Valuation Act. 7. On 11 June 2024, the Applicant filed a Class 3 Application appealing the First Respondent's determination of its objection, within the required 60-day period pursuant to s 38 of the Valuation Act. 8. The matter was provided with case number 2024/215070. 9. The land value contended by the Applicant in the proceedings in its Class 3 Application was $228,300,000. 10. The Applicant was served a Land Tax Assessment Notice issued on 9 January 2024, notifying a valuation for the purposes of the Land Tax Management Act 1956 (NSW) under s 14 of the Taxation Administration Act 1996 (NSW) in connection with the Subject land for the 2023 Valuing Year (2023 Valuation), which provides a basis for objection under s 35(1)(b) of the Valuation Act. 11. The issued land value for the Land under the 2023 Valuation for the 2023 Valuing Year was $477,292,810. 12. At the time of the 2023 Valuation: 13. (a) the Applicant was the owner of Lots 1 and 3 in DP1290500; and 14. (b) the Second Respondent was the owner of Lots 2 and 4 in DP1290500. 15. The Applicant lodged an objection to the issued land value with the First Respondent pursuant to ss 29(3A) and 34 of the Valuation Act on 4 March 2024. 16. On 27 May 2024, pursuant to s 35B of the Valuation Act, the First Respondent partially allowed the Applicant's objection, recommending that the issued land value for the Land as at the 2023 valuing year be amended to $438,875,113, and issued a Notice of Determination to the Applicant as required by s 35C of the Valuation Act. 17. On 26 July 2024, the Applicant filed a Class 3 Application pursuant to s 37 of the Valuation Act appealing the First Respondent's determination of its objection, within the requisite 60-day period pursuant to s 38 of the Valuation Act. 18. The matter was provided with case number 2024/274477. 19. The Land Value contended by the Applicant in the proceedings in its Class 3 Application was $274,240,000. Legislation - Valuation of Land Act 1916 1. Section 6A of the Valuation Act provides as follows: 6A Land value (1) The land value of land is the capital sum which the fee-simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona-fide seller would require, assuming that the improvements, if any, thereon or appertaining thereto, other than land improvements, and made or acquired by the owner or the owner's predecessor in title had not been made. (2) Notwithstanding anything in subsection (1), in determining the land value of any land it shall be assumed that— (a) the land may be used, or may continue to be used, for any purpose for which it was being used, or for which it could be used, at the date to which the valuation relates, and (b) such improvements may be continued or made on the land as may be required in order to enable the land to continue to be so used, but nothing in this subsection prevents regard being had, in determining that value, to any other purpose for which the land may be used on the assumption that the improvements, if any, other than land improvements, referred to in subsection (1) had not been made. (3) Notwithstanding anything in subsection (1), in determining the land value of any land, being land in relation to which, at the date to which the valuation relates, there was a water right— (a) the land value shall include the value of the right, and (b) it shall be assumed that the right shall continue to apply in relation to the land. (4) For the purpose of determining the value of a water right, the value of any water secured by, or referable to, that right is to be ignored. 1. Section 26A of the Valuation Act further provides follows: 26A Valuation of parcels that form part of the site of a building (1) If the site of a building is subdivided into separate parcels of land solely by means of a subdivision to which this section applies, the value of each of those parcels is to be determined as follows— (a) first, the Valuer-General is to value all of those separate parcels as if they comprised a single parcel and that single parcel and all improvements on it were owned by a single owner, and (b) then, the Valuer-General is to apportion the value obtained under paragraph (a) between each of those separate parcels, on the basis of their respective rental values as a proportion of the sum of the rental values of each of those parcels. (2) This section applies to subdivision by any of the following means— (a) subdivision by the creation of 2 or more lots in a deposited plan, (b) subdivision by a deposited plan and one or more strata plans, (c) subdivision by 2 or more strata plans. (3) This section does not apply unless at least 2 or more of the parcels of land created by the subdivision are adjoined horizontally (that is, one is wholly or partly above the other). (4) The site of a building includes land consisting of space above or below the building. (5) In determining the rental value of a parcel of land, regard is to be had to any improvements on or appertaining to the parcel. (6) This section does not limit any power of the Valuer-General to include 2 or more parcels of land that are owned by the same person in one valuation. (7) In this section— building includes a building that is in the course of construction. parcel of land means a parcel (within the meaning of the Strata Schemes Development Act 2015) or the land comprised in a lot in a deposited plan. strata plan means a strata plan within the meaning of the Strata Schemes Development Act 2015. 1. Further, Pt 4, ss 37-40 of the Valuation Act states: Part 4 Appeals to Land and Environment Court Division 1 Appeals 37 Right of appeal (1) Any person entitled under Part 3 to object to a valuation may appeal to the Land and Environment Court if the person is dissatisfied with the Valuer-General's determination of any such objection to the valuation concerned (whether or not the person was the objector). (2) An appeal may not be made on the ground that the objection is taken to have been disallowed, as referred to in section 35C (4), unless written notice of the objector's intention to appeal on that ground has been given to the Valuer-General at least 14 days before the appeal is made. (3) No person or body has jurisdiction or power to conduct a review or hear an appeal in respect of the determination of an objection except as provided by this Part. 38 Time for appeal (1) An appeal must be made not later than 60 days after the date of issue of the notice of the Valuer-General's determination of the objection. (2) The Land and Environment Court may allow a person to appeal after the 60-day period. 39 Grounds of appeal The appellant's and respondent's cases on an appeal are not limited to the grounds of the objection. 40 Powers of Land and Environment Court on appeal (1) On an appeal, the Land and Environment Court may do any one or more of the following— (a) confirm or revoke the decision to which the appeal relates, (b) make a decision in place of the decision to which the appeal relates, (c) remit the matter to the Valuer-General for determination in accordance with the Court's finding or decision. (2) On an appeal, the appellant has the onus of proving the appellant's case. 1. The Court arranged a conciliation conference under s 34(1) of the LEC Act between the parties, which was held on 1 November 2024. I presided over the conciliation conference. 2. The Conciliation Conference was adjourned on that occasion until 9 December 2024 to facilitate further discussions between the parties' valuation experts. 3. The parties' valuation experts met between the occurrences of the Conciliation Conferences to discuss the appropriate valuation and apportionment of Lots 1-4 of DP1290500, for the purpose of valuing the Subject land. 4. At the conclusion of this process, an in-principal agreement was ultimately reached by the parties that the value of the Parent parcel as at 1 July 2022 and 1 July 2023 was $505,340,000 to be apportioned as follows: Lot Apportionment Land Value Lot 1 (Residential) 85.30% $431,047,677 Lot 2 (Hotel) 12.88% $65,080,545 Lot 3 (Rugby Place) 0.02% $88,712 Lot 4 (Retail) 1.81% $9,123,067 1. This agreement was confirmed by the parties at the Conciliation Conference held on 9 December 2024. 2. Under s 34(3) of the LEC Act, I must dispose of the proceedings in accordance with the parties' decision if the parties' decision is a decision that the Court could have made in the proper exercise of its functions. The parties' decision involves the Court exercising the function under s 40(1) of the Valuation Act to "make a decision in place of the decision to which the appeal relates" in relation to the land value of the land as of 1 July 2022 and 1 July 2023. 3. There are jurisdictional prerequisites that must be satisfied before this function can be exercised. The parties identified the proceedings fall within Class 3 of the Court's jurisdiction pursuant to s 19(b) of the LEC Act and explained how the jurisdictional prerequisites have been met: 1. The value of the Land is referrable to s 26A of the Valuation Act; As at the time of the Second Supplementary 2022 Valuation, the 2023 valuation: 1. (a) the Applicant was the owner of Lots 1 and 3 in DP1290500; and 2. (b) the Second Respondent was the owner of Lots 2 and 4 in DP1290500. 3. The First Respondent issued a notice of determination in respect of the Applicant's objections to the Second Supplementary 2022 Valuation and the 1 July 2023 valuation. 4. The Applicant is entitled to bring these Proceedings pursuant to ss 29(1)(a), 29(3A) and 37(1) of the Valuation Act. 5. The Applicant filed its Class 3 Applications under s 37(1) of the Valuation Act on 11 June 2024 regarding the Second Supplementary 2022 Valuation and on 26 July 2024 regarding the 2023 Valuation, within the 60-day limitation period imposed by s 38(1). 6. The Court has the power to make a decision in place of the decision to which the appeal relates pursuant to s 40(1)(b) of the Valuation Act. 7. The parties attended a Conciliation Conference in good faith pursuant to s 34 of the LEC Act. 8. Following discussions between the experts, the parties arrived at an agreed figure that was acceptable to the parties, within the meaning of s 34(3) of the LEC Act. 9. The Court has the power to dispose of the proceedings pursuant to an agreement reached between the parties pursuant to s 34(3) of the LEC Act. 1. For the reasons set out above, I am satisfied that the parties' decision is one that the Court could have made in the proper exercise of its functions, as required by s 34(3)(a) and (b) of the LEC Act for the "disposal of proceedings in accordance with the parties' decision". 2. As the parties' decision is a decision that the Court could have made in the proper exercise of its functions, I am required under s 34(3) of the LEC Act to dispose of the proceedings in accordance with the parties' decision. Notation: 1. The Court notes: 1. The Second Respondent did not object to the determination issued by the First Respondent for Lot 4, as the value determined at the time was $1. On 1 October 2024, the First Respondent issued a Redetermination of Land Value to the Second Respondent for Lot 4, in the amount of $10,898,930. At the date the redetermination was issued, proceedings 2024/00215070 and 2024/00274477 had already commenced. Therefore, the parties agree, though an objection has not been made by the Second Respondent for Lot 4, the First Respondent will reascertain the Land Value of Lot 4 under s 14A(6) of the Valuation Act consistently with the section 34 agreement and inform the Second Respondent of the reascertainment. 2. Further, although no appeal has been lodged in respect of the value of Lots 2 and 3, the parties note that the land value of those lots is necessarily affected by the parties' agreement as to the land value of the Parent Parcel, their agreed apportionment between the lots comprising the Parent Parcel as set out at paragraph 22 above, and the order the parties seek that the Court makes in respect of the Land Value of Lot 1. Therefore, the parties agree that, although no appeal has been brought by the owners of Lot 2 or Lot 3 in respect of those lots in these proceedings, the First Respondent will reascertain the Land Value of Lots 2 and 3 under s14A(6) of the Valuation Act consistently with the section 34 agreement and inform the Applicant and Second Respondent of the reascertainment. 3. Further, the parties agree that, consistent with its obligations under s 14DD(1) of the Valuation Act, the First Respondent will make such alterations to the Register of Land Values to give effect to the reascertainment of the value of the lots comprising the Parent Parcel as may be necessary following the making of this section 34 agreement and the consequential reascertainment of the land values of Lots 2, 3 and 4. 4. Each party is to bear its own costs of these proceedings. Orders: Proceedings 2024/215070 1. The Court orders: 1. The appeal is upheld. 2. The land value of Lot 1 in Deposited Plan 1290500 for valuation year 1 July 2022 is determined in accordance to s 6A and s 26A(1) of the Valuation of Land Act 1916 (NSW) to be $431,047,677 being an apportioned value of 85.30 percent of the value of the Parent parcel as set out in the following table. Lot Apportionment Land Value Lot 1 (Residential) 85.30% $431,047,677 Lot 2 (Hotel) 12.88% $65,080,545 Lot 3 (Rugby Place) 0.02% $88,712 Lot 4 (Retail) 1.81% $9,123,067 Parent parcel 100% $505,340,000 Proceedings 2024/274477 1. The Court orders: 1. The appeal is upheld. 2. The land value of Lot 1 in Deposited Plan 1290500 for valuation year 1 July 2023 is determined in accordance to s 6A and s 26A(1) of the Valuation of Land Act 1916 (NSW) to be $431,047,677 being an apportioned value of 85.30 percent of the value of the Parent parcel as set out in the following table. Lot Apportionment Land Value Lot 1 (Residential) 85.30% $431,047,677 Lot 2 (Hotel) 12.88% $65,080,545 Lot 3 (Rugby Place) 0.02% $88,712 Lot 4 (Retail) 1.81% $9,123,067 Parent parcel 100% $505,340,000 Michael Davidson Acting Commissioner of the Court ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 29 January 2025