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INSURANCE COMMISSION OF WA

Ellenbrook Restrictive Covenant

Background Information

The Ellenbrook subdivision is comprised of 1,200 hectares owned by joint venture partners and the Housing Authority.

LWP Property Group are responsible for the development of Ellenbrook on behalf of the joint venture partners. At the time the Insurance Commission purchased the 18.7 hectare shopping centre site, it was a green field site, as was the immediate surrounding area.

Relevant planning and other advice to the developers LWP was that for the establishment of a green field development such as Ellenbrook, the major retail component should be located in a certain area and other retail developments should be limited until the main shopping centre expanded and the population reached a certain size.

As a result LWP proposed the implementation of a restrictive covenant with the purpose of ensuring a coordinated approach to retail development and to create a vibrant, well-planned Town Centre of which the shopping centre site would be a component. It was also anticpiated that the introduction of the restrictive covenant would expedite the development of the Ellenbrook community, by allowing the shopping centre (which has the benefit of the restrictive covenant) to secure anchor tenants and create a hub of commercial activity for local residents.

The Insurance Commission purchased the Shops at Ellenbrook site on 7 November 2003.

The Restrictive Covenants:

There are two restrictive covenants:

  1. I687182, which is registered over certain land which is, or was, owned, by Housing Authority; and
  2. I687188, which is registered over land that is, or was, owned by the joint venture partners.

The terms of both restrictive covenants are virtually identical.

The restrictive covenants are accessible by the public through Landgate. For convenience, copies of both restrictive covenants are attached for your information.

When the restrictive covenants were created they were registered only:

  • over land in Ellenbrook which was owned by the Housing Authority and the joint venture partners; and
  • over those lots which were over 3,000 sqm in size.

Where these larger lots have been subdivided, the restrictive covenant remains and is applicable to (and on the title of) the smaller subdivided lots, by operation of law.

The restrictive covenant limits certain retail developments, details of which can be obtained from the terms of the restrictive covenants.

Future Intentions of the Insurance Commission

The Insurance Commission plans to continue to develop the Shops at Ellenbrook to a high standard and for it to remain a focal point of the Ellenbrook Town Centre.

The Insurance Commission has not sold any portion of the shopping centre site since its acquisition and has no present intention to sell any part of the site. This is a reflection of the Insurance Commission's commitment to the continuing development of Ellenbrook.

The restrictive covenants are paramount to ensure the ongoing viability of the proper coordinated development of retail and to facilitate the development of the proposed future stages of the centre.

As part of the green field site development, the Insurance Commission has undertaken to develop a major shopping centre in the Town Centre.

Stage 1 of the shopping centre has been completed, and the terms of the restrictive covenant provide that Stage 2 is required to be completed by 31 December 2010 or a later time, depending on the population figures in Ellenbrook.

Notwithstanding that the population has not yet reached the requisite threshold, the Insurance Commission has commenced preparations for the development of Stage 2 and construction will commence early 2010.

It is proposed Stage 2 will have a lettable area of approximately 20,000 sqm and will include a discount department store, a second supermarket and approximately 60 specialty shops. Upon completion, Stages 1 and 2 will collectively comprise over 30,000 sqm of retail space and include over 90 shops. The Insurance Commission estimates that Stage 2 will create approximately 1,000 jobs in the Ellenbrook area.

Subject to certain developments being confirmed, Stage 2 may also include works which will see a further 6,000 to 8,000 sqm development take place accommodating big box type retail stores.

Purchasing Land in Ellenbrook

Persons wishing to develop or establish a business in Ellenbrook on land burdened by the restrictive covenants should seek their own legal advice in relation to their proposed transaction and particularly the applicability and effect of the restrictive covenants on their land.

The Insurance Commission however is willing to assist by guiding them through the process. If guidance is sought then please contact the Insurance Commission setting out the proposed use and/or how it is intended to deal with the land.

Subject to certain agreements being reached with relevant third parties, the Insurance Commission will agree not to enforce the restrictive covenant in relation to retail shops less than 300 sqm on the basis of its interpretation of what constitutes "local needs" so as to encourage retail development in Ellenbrook (provided that such shops do not create a "neighbourhood centre" as defined in the restrictive covenant).

The Insurance Commission will also need to have further consultation with the Ellenbrook community and tenants of the Ellenbrook shopping centre in regard to this matter. Discussions are ongoing with all the abovementioned stakeholders. The effect of which is that the Insurance Commission is working co-operatively with all stakeholders, including the ACCC who has advised that it does not consider the restrictive covenant to be in contravention of the Trade Practices Act.

The Insurance Commission encourages prospective retailers, or landlords with prospective retailers to contact the Insurance Commission with a view to discussing how their proposed use of the land may be affected by the restrictive covenants.

For those parties interested in establishing a business in Ellenbrook, please note the uses specified on the attached list are uses that in our interpretation do not contravene the restrictive covenant on the basis that the proposed uses were less than 300 sqm and met local needs or were outside the scope of the restrictive covenant for other reasons.

Release Date Statement Title
4 September 2008 Restrictive Covenant I687182
4 September 2008 Restrictive Covenant I687188
14 August 2009 Future Staged Unrestricted Retail Masterplan
7 October 2009 The Brook Press Release - Photo 1 & Photo 2
14 January 2010 Restrictive Covenant Uses

For more information regarding Ellenbrook please visit the weblink...

To see what was said in Parliament about the restrictive covenant, click here.