Greg Chemello discusses winding up Ipswich City Properties.
Greg Chemello discusses winding up Ipswich City Properties. Cordell Richardson

Value of council's 'junket' CBD company to be revealed

AN INDEPENDENT report into the total lifetime costs of Ipswich City Properties will be prepared as the council works towards shutting the controversial entity down.

Ipswich City Properties, the council-owned company responsible for managing leases and progressing the redevelopment of the CBD, will be wound up.

The cost of closing the company has not yet been assessed, a spokesman for Ipswich City Council said.

"Council is in the process of developing a detailed action plan as the matters are quite complex to ensure the appropriate integration into council," he said.

"The exact timing of the de-registration, therefore, cannot be specified at this time, but probably not before mid-2019."

Administrator Greg Chemello said an independent report into the total life-cycle cost of Ipswich City Properties would be prepared.

"It will capture all the costs of creating, operating and closing down Ipswich City Properties," Mr Chemello said.

"It will also compare that to the cost of what council has done on the development to date on its own without the company.

"It will give the community of Ipswich a very clear view of the actual cost of company life and the costs that would have been incurred anyway."

He said it would "dispel any concerns about what the extent of that is, just to make that very clear and transparent".

It is expected to be published early next year.

Ipswich City Properties has been the subject of controversy in recent times.

Former councillors, who were directors of the company, used it to travel overseas and fly on private jets.

Ipswich City Properties officials, including councillors and staff, travelled on an all-expenses-paid trip to the United States in 2010 as well as Italy, France, the UK and Abu Dhabi.

The company also spent about $83,000 of ratepayer funds on lawyers to conceal the costs of the trips after a right to information request was lodged.

Three weeks before Ipswich councillors were dismissed, Local Government Minister Stirling Hinchliffe seized on a McGrath Nicol report which he said revealed "a culture of secrecy, entitlement and a lack of accountability".

Mr Hinchliffe slammed the "dud deals" of the company which he said has "saddled Ipswich ratepayers with massive costs, while generating next-to-nothing in return".

"Ipswich City Properties incurred losses of up to $50 million - all ratepayers' funds - on an Ipswich CBD redevelopment that never eventuated," he said in July.

Former councillor Paul Tully, then chair of Ipswich City Properties, dismissed Mr Hinchliffe's claims and said the company had delivered for ratepayers.

He said of a $50 million loan to the company, $30 million had bought land which the council continues to own.

Mr Tully also said the $93m Icon Tower development was a success of the company.

The McGrath Nicol report noted Ipswich City Properties paid $51.3 million for three CBD properties between 2009 and 2018.

In February this year, the three properties were valued at $32.53 million.

Mr Chemello said ensuring the CBD redevelopment progresses before the next election is one of his highest priorities.