Why produce wholesalers are refusing to pay rent to the Epping Market
Fresh produce wholesalers and growers have pushed back against a major rent hike proposal at a Melbourne market, enacting a strike effective immediately.
Victoria
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Tenants at Melbourne’s major wholesale fresh produce market have declared a rent strike, in protest of a proposal to double their rent across the next 10 years.
But the market authority has hit back at wholesaler representative Fresh State, stating the group has opted for “media stunts and disruptions” over rental negotiations.
About 40 per cent of all fruit and vegetable grower and wholesale tenants at the Melbourne Market Authority’s Epping market gathered in protest on Thursday, and officially signed a letter declaring a rental strike, effective immediately.
The rent strike is in response to the MMA’s plan to raise rents by 100 per cent over 10 years. It includes a strike against all payments made to the MMA, including parking fees, refrigeration fees, power, and forklift registration.
Fresh State chief executive Jason Cooper said the first increased rental payment is due next week.
“The levels of rent they’re proposing means half the businesses in there will go broke,” Mr Cooper said.
“If we can’t get them to sit down and come to a commercial arrangement … they’re just not listening. What they’re looking to do is come up with a number that works for them, but we’re saying the numbers that they’re putting forth are just not sustainable for industry.
“It’s not us compromising food security, it’s the MMA being unreasonable and putting wholesalers in a position where if they absorb these costs, they’ll go broke.”
An MMA spokesperson said the authority was “at the table, ready to talk anytime, but Fresh State’s chairs are empty”.
“Instead of working with us, they’ve chosen media stunts and disruptions, risking the supply of fresh produce to Victorians,” the spokesperson said.
The MMA extended the lease review to 10 weeks, but according to the spokesperson did not receive any commercial counteroffer from tenants or representatives.
“The MMA yesterday offered to reduce the CPI component of the fixed annual increase by 0.5 per cent. But rather than negotiate, Fresh State have chosen threats of rent strikes and shutting down the site without presenting a viable alternative,” the spokesperson said.
Koo Wee Rup asparagus grower Michael Motta said prices at the market had been rising for a number of years.
“Then there’s outgoings too. It’s just ridiculous,” Mr Motta said.
“With water, rates, power, on top, it’s just not competitive. What they’re proposing with the rent increase in nine to 10 years’ time, it’ll be close to $1200 a square metre. It’s not sustainable.”
Mr Motta said markets were an integral part of the horticulture sector, but the pressure was mounting for growers.
“This is a very strong market, a very good market, but what they’re doing is driving us out,” Mr Motta said.
“It just doesn’t make any sense, trying to get a product to the customer cheaply and it’s just not possible.”
An ideal outcome, Mr Motta said, would be the MMA tearing up the lease, removing the ratchet clause, and installing a commercial lease agreement.
“They need to be fair dinkum, tear up the lease, and start from scratch,” Mr Motta said.
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Originally published as Why produce wholesalers are refusing to pay rent to the Epping Market
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