Council meeting agenda - 4 June 2012 - Clarence City Council

"Rosny Hill Nature Recreation Area" 12A Akuna Street
Rosny, Tasmania
Depending on the complexity of the property and the level of due diligence required to lodge a
signed contract, purchasers may not be willing to participate in a second stage if a signed contract
is required. In such cases, a preferred party may be selected and provided an exclusive period in
which to complete due diligence and exchange contracts at the agreed price.
Benefits of expression of interest include:
� It is a commonly accepted method of sale in commercial property markets;
� The method is similar but less formal and more flexible to a public tender campaign;
� All prospective purchasers are given the opportunity to submit an EOI;
� The method is nationally and internationally accepted due to the opportunity to participate
in the first stage of the process with limited time and costs associated;
� Flexibility in terms offered can often influence the purchase price. Expressions of Interest
allow variations to a standard contract of sale enhancing the prospect of maximisation of
price to the vendor.
� The method allows confidentiality of information to the invited bidders;
� The method imposes timeframes for a receipt of EOI;
� Agents will have access to a database of prospective purchasers to invite to submit an EOI;
� After receipt of EOIs negotiations can be undertaken confidentially;
� An agent facilitates negotiations between the buyer and the vendor and can identify common
ground;
� The method is able to facilitate conditions precedent to a sale by either the prospective
purchaser or vendor;
� The method can allow the vendor to assess various expressions of interest to achieve the best
outcome. This can be of significant benefit in assessing differing development projects which
requires greater consideration than just the proceeds of sale (price);
� The method can be used as a fore-runner to other methods of sale eg sale by private treaty
with preferred parties;
Limitations of expression of interest include:
� The method does not (on its own) promote competition between purchasers;
� The method can be criticised to be secretive by unsuccessful parties;
� Documentation required to be prepared in the EOI process may compel the prospective
purchasers to incur costs without any guarantee of success;
� Some purchasers are intimidated by the method;
The EOI process is considered the most appropriate marketing method for the sale or leasing of a
leasehold interest in the RHNRA because:
� It provides Council with the opportunity to consider potential uses put forward by proponents
before deciding on the preferred development concept;
� It allows Council to balance the interests of the general public with the interests of
commercial operators;
� The method is transparent and provides an opportunity for any party to express an interest in
the proposed future use of the site;
� The nature of the site requires flexibility in terms of commercial negotiations for the
development of the site;
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