‘Lionsgate’ on old Holden site will employ 1200 people after Pelligra Group redevelopment
The workforce at the former Holden site at Elizabeth will grow to more than 1600 as the wave of optimism engulfing SA continues to surge.
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- Whyalla reborn: New steel mill, hotel, horticulture, recycling
- Pelligra Group buys Holden site now called Lionsgate
The workforce at the former Holden site at Elizabeth will grow to more than 1600 as the wave of optimism engulfing SA continues to surge.
Five hi-tech manufacturing companies will join German battery operator Sonnen on the 123-hectare site, renamed Lionsgate.
More than 60 workers from aircraft component manufacturer Levett Engineering started moving in this week and about 180 from Melbourne steelmaker Genis Steel will join them in the New Year.
Site owner Pelligra Group will announce in February three more companies will bring an extra 1000 jobs to Lionsgate.
Sonnen currently employs about 400 people but has plans to expand in 2019.
Mr Pelligra told The Advertiser he was unable to name the three new companies but said two were from Australia and the other from the US.
Remediation work at Lionsgate was complete and the site was connected to a high-speed fibre optic communications network, he said.
“It would be easy to fill Lionsgate with warehousing but we don’t want to do that,” he said.
“Our client selection (process) has been to look at companies that employ high numbers of staff and are engaged in hi-tech engineering or manufacturing.”
The Lionsgate news caps a remarkable week for South Australia, during which Whyalla celebrated a $600m steelworks expansion and Lot Fourteen in Adelaide was named as the headquarters of the Australian Space Agency.
The Pelligra group is poised to inject hundreds of millions of dollars into Sanjeev Gupta’s Whyalla rejuvenation, including $45 million in a four-star ocean-view hotel.
Mr Pelligra said this week’s Whyalla, space agency and City Deal announcements, plus the state’s impending $90 billion boom, provided essential confidence, certainty and framework for a prosperous and sustainable future.
“There is a lot more excitement among the community especially business people,” he said.
He urged South Australian business and community leaders to take decisive action to join the upcoming economic and lifestyle boom.
“It’s important that SA business people start expanding now because if we don’t, it (investment) will either go nationally or internationally,” he said.
“The dial up has to happen. The idea of bringing in a major project to a city is so you then build it with your people and try and recirculate the project, and benefits, back into the community, so everyone prospers from it.”
Melbourne-based Mr Pelligra said Premier Steven Marshall was working hard to build up business and new opportunities and he was pleased to invest in the state.
He also flagged a revamped Whyalla airport to cater for an increase in air traffic and said the initial cash injection into the town was a sign of things to come.
“The hotel is just the start,” he said.
“From there, there will be opportunities to develop better quality housing, lifestyle and sporting facilities, things we take granted in our major cities.
“The cost is high but if you are going to bring people in, you have to invest.”
But he warned the Whyalla revival would fail without significant infrastructure upgrades and planning to complement Gupta’s $600 million steel, $1.4 billion million renewable energy and $145 million horticulture uplift.
“Sanjeev is going to be rebuilding his plant,” Mr Pelligra said.
“To keep a sustainable city, you need to redevelop a lot of things from residential, to lifestyle, to food and beverage, to kids’ activities to activities for teenagers, all-round.
“We were looking at some of the things that we can bring on pretty quickly and the hotel was the most obvious one that needed quick attention.”
Mr Marshall said Pelligra Group’s decision to invest in SA showed a growing confidence in the state’s economy.
Why we’re investing in South Australia
Almost as an afterthought as we were ending our chat at Adelaide’s former General Motors Holden site this week, the multi-millionaire Ross Pelligra threw in another gem.
“And I’ve just bought a soccer club,” he said. “South Melbourne.”
Impressive indeed but decidedly small fry in relation to his other spending this week.
A $250 million outlay on the Holden site - renamed Lionsgate - this time last year was the first South Australia had heard of the 40-year-old from inner Melbourne. And he will not be going away.
The desire to invest in Elizabeth was driven not just by a compelling investment but because Mr Pelligra saw a skilled and loyal workforce on its knees – one he identified with.
Whyalla has solicited a similar response. He has visited the recently beleaguered steel town just five times but the decision to invest hundreds of millions of dollars was made before his feet touched the ground on the first trip. This was a trip that came about through his long-term friendship, and business relationship, with Whyalla steel saviour Sanjeev Gupta.
“Sanjeev invited me to Whyalla. My first trip was on his private jet and as we were flying in, we did a spin round the town and without him saying too much, I actually saw it (the potential) straight away,” Mr Pelligra says.
“Travelling around the world, I have seen cities in China that have developed from manufacturing and seen how they are able to grow. What Sanjeev is planning to do is not something that has not been done before.”
First impressions clearly count with Mr Pelligra. Whyalla desperately needed a hotel to reflect its upcoming status, the current motel-only offering won’t cut it with future investors and the fly in, fly out crews who will shortly populate Whyalla.
There is also – surprisingly for outsiders perhaps – a tourism option for Whyalla.
“The beaches there are unbelievable,” he says. “I took Sanjeev out for a stroll one night after dinner, there were dolphins in the water. It’s clear, clean, good for fishing and swimming, so the idea of the hotel is that it will be designed for the weekday tourist and business people as well as weekend tourists. You can get away for the weekend there, it’s only a 3.5 hour drive from Adelaide.”
The decision on a hotel operator – an outfit with the same mindset says Mr Pelligra – will be made by the 22 person Pelligra board.
While Ross is the chairman and driving force – when he talks the room falls quiet and everyone listens – the firm was founded by his grandfather and money flows in from external investors, hence there is a collectivism at the very top. But they are agreed on the fundamentals Mr Pelligra says. Put in the infrastructure now or, in the long term, all projects will fail.
“We are looking at all sectors of property we are experts at. As the community grows, we want to be sure we are ready with operators to be able to help them grow.”
The word that recurs time and again in our conversation is “patient”. Patient capital – the long haul – is what it’s all about, he says.
“Sanjeev brought me in because he needs to create. It’s not all about steel, it’s about creating other industries to support the community and the amenity in. The smartest thing you can do is to bring in experts to try and help you deliver. He knows we are across all different industries when it comes to property.”
Whyalla he says, with the right investment, is simply a very good deal.
“Once the growth starts in Whyalla and some of the baby boomers want to downsize eventually, they will be able to get a decent payout for what they invested which then allows them to downsize. The idea is that the whole economy grows, the whole community and everything grows with the major projects.
“When we go into a project, we run analytics to figure out where the growth is, what it’s doing, we look at other projects, other towns, countries, similarities and use them as case studies to help us come up with a conclusion on how fast we grow.
“We want to set a benchmark, a new standard. The steel is setting a new standard, the solar is setting a new standard, the hotel will.”
While Whyalla fits the Pelligra template of investing in low-key, industrial development – he is working on seemingly no end of industrial parks and shopping centres across Victoria – a foray into the Adelaide CBD is breaking new ground.
The Allianz building at 89 Pirie St will be transformed into “funky new offices” after settlement in March, and Mr Pelligra has not ruled out a hotel component on the site.
Mr Pelligra said the abolition of stamp duty on commercial property would prove fundamental to a state upturn. The Pirie St purchase would simply not have happened without it. News of the change had spread to the east coast and international giants are circling. So too is Pelligra.
“We are looking for other opportunities in the CBD on a similar basis as well.
Mr Pelligra said defence and space uplifts for SA would provide an essential confidence, certainty and framework for the state.
“There is a lot more excitement among the community especially business people. Steven Marshall has followed through on what was already promised. He hasn’t upset the community in that sense and is bringing in more.”
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