Sweeteners aplenty in secret Barangaroo developer deal

An inquiry into the development will on Friday hear from Lendlease executives along with Grocon boss Daniel Grollo and ex-premier Mike Baird.

Then Lendlease chief executive Steve McCann with Mike Baird surveying the construction on Tower 3 of the Barangaroo development.

The NSW government conferred legal indemnity and lucrative additional floor space on two developers working on Barangaroo in exchange for little except the end of a legal stoush, previously confidential deal documents show.

A parliamentary inquiry into the development will on Friday hear from Lendlease executives and former Crown figures, along with Grocon boss Daniel Grollo and ex-premier Mike Baird, along with his senior private staff.

The inquiry is exploring how a dispute between Lendlease and Crown Resorts, on one side, and the NSW government, was resolved with the granting of a raft of concessions to the companies.

Lengthy negotiations between the two parties led to nine different designs for Barangaroo and major delays which has left the precinct a construction site years after the projects first began.

A previously confidential 2019 deed released by parliament shows the state handed Lendlease and Crown an additional 8000 square metres of gross floor area for their developments, as well as giving the consortium the ownership of public land for their own use.

The deal swelled the total size of the Renzo Piano towers in Barangaroo, but also locked the state government into paying the developers $80m if Lendlease and Crown decided not to go through with the expansion.

Mr Grollo, whose company was developing an adjacent site, has claimed the additional floor space handed to Crown and Lendlease gave the developers extra developable area worth “in excess of $300m in revenue”.

The secret deed showed Lendlease was given the rights not to pay any licence fees for the use of the street area in Barangaroo as well as register its own easement over parts of the precinct.

Crown was given large areas of the waterfront abutting its massive casino development.

In addition, the deal amended the milestones for Crown and Lendlease, pushing final wrap up of works into 2027.

The developers had launched legal action against the NSW state government, alleging Infrastructure NSW had sold the rights to the views of the Sydney Harbour Bridge and the Opera House twice, first to them and second to Grocon.

The deed required the NSW state government to hand Crown and Lendlease $5m each to cover their legal bills from the fight with the state government.

Further it offered $6m in indemnity for the legal bills of Crown and Lendlease over any potential legal fight with the developer of Central Barangaroo.

INSW also accepted “all risks obtaining the consent of the Central Developer to all matters relating to Central Barangaroo”.

Grocon is suing INSW, claiming the agency acted in favour of other developers in the harbourside precinct and restricted its project. Grocon claims INSW saw it short-changed $270m over the sale of its stake in Central Barangaroo to Aqualand.