MPs can't escape party donors

It's hard to buy property not being sold by a benefactor, says one politician

NSW Treasurer Eric Roozendaal says politicians have little choice but to buy property from developers who have donated to political parties, so entrenched have donations become in Sydney.

Mr Roozendaal said this after investigations by The Weekend Australian found he and federal minister Mark Arbib in 2003 had bought luxury beach-suburb townhouses from a prominent Sydney businessman who manages a company that has been a generous donor to the ALP.

The pair bought the townhouses at Maroubra in Sydney's east from private company Telmet Ventures, owned by former BRW rich-lister Brian Boyd, who is also managing director of property developer Payce Consolidated. Payce has often negotiated with the NSW government over planning issues associated with its unit developments in Sydney's west.

Mr Roozendaal said all the transactions were above board.

"Every developer in Sydney is a donator to both political parties so, the chances are, anybody purchasing a brand new investment property will be buying it from someone who donates to a political party," he said.

The purchases of the two three-bedroom townhouses overlooking a park across the road from the beach have proved lucrative for Mr Roozendaal and Senator Arbib. Mr Roozendaal's property increased in value at more than three times the suburb average while Senator Arbib's grew at 1 1/2 times the rate of median prices.

Unlike official transfer documents relating to each of the other 18 apartments in the complex, the documents relating to the apartments bought by Mr Roozendaal and Senator Arbib do not disclose how much the men paid for the apartments.

At the time, the Maroubra apartments were purchased, Mr Roozendaal was general secretary of the NSW ALP and earning a reputation as one of the party's legendary fundraisers. Senator Arbib was his deputy.

Mr Boyd, who was estimated to be worth more than $60 million last year on the BRW rich list, is also a director of building and construction company Paynter Dixon. Both Payce and Paynter Dixon have donated large sums of money to political parties over the past decade.

Both Mr Roozendaal and Mr Arbib said they had not received any donations personally from any company associated with Mr Boyd. A spokesman for Mr Boyd said all donations to political parties had been lawfully declared.

He said the properties sold by Mr Boyd's Telmet Ventures to Mr Roozendaal and Senator Arbib had been sold under normal conditions. "The purchase of properties from Telmet was at market value," the spokesman said.Both Mr Roozendaal and Senator Arbib declined to comment on whether they discussed with each other their intentions to purchase the townhouses before they bought. The properties were bought off the plan in 2002 and settled within the same week in July 2003, according to the men.

ALP figure and lawyer George Newhouse handled the purchases of the apartments, acting for both Mr Roozendaal and Senator Arbib's wife (the property was bought in the name of his wife).

Mr Roozendaal said he could not remember precisely how he became aware the apartment was for sale, but he believed ALP stalwart and fundraiser Sam Fitzman "may have mentioned it to me at the time". Fitzman died in 2002.

Mr Roozendaal said he thought his lawyer had dealt directly with Telmet Ventures when buying the apartment. A spokeswoman for Senator Arbib said he could not recall how he became aware the Maroubra apartment was for sale.

Local real estate agents contacted by The Weekend Australian said it had long been rumoured Mr Roozendaal, Senator Arbib and another Labor MP, Eddie Obeid, had all bought apartments in the complex. Mr Roozendaal and Senator Arbib rejected any impropriety in the deal. Senator Arbib said he paid $647,000 and Mr Roozendaal said he paid $650,000 for the townhouses. A similar-sized unit next door to Mr Roozendaal's was sold off the plan by the agent to a local for $785,000. It settled in 2003.

Mr Roozendaal sold his property in January last year for $1.05m, earning him a profit of $400,000, or a gain of 62 per cent on the purchase price.

According to research by RP Data, the median Maroubra house price grew by 16 per cent in that period while median apartment price grew by 13 per cent.

Senator Arbib, who said he had contracted to buy the apartment in January 2002, onsold the property for $960,000 in January 2007, realising a 48 per cent gain on the purchase price. According to RP Data, median house prices in Maroubra grew 33 per cent in that time while median apartment prices grew by 20 per cent.