Corporate spill in suburbs when the levy Breaks Cameron Houston Date: 14/05/2005 THE AGE
Corporate spill in suburbs when the levy breaks
CAMERON HOUSTON
Date: 14/05/2005
THE AGE
THE State Government's decision to impose a $400 levy on CBD parking spaces and raise parking meter charges by 25 per cent has incurred the wrath of city retailers, but it could be an unexpected boon for suburban office owners.
Chief executive of Colliers International's Mulgrave office Rob Joyes says the impost will be a further burden on CBD-based businesses, which could be tempted to relocate to suburban office precincts.
He predicts the car parking levy will add "hundreds of thousands of dollars" to the overhead costs of larger CBD-based tenants, including Telstra, Australia Post and the Victorian Public Service.
"Increasing parking fees by what would equate to around 10 per cent in the CBD and up to 15 per cent on St Kilda Road, and then to double that amount in 2007, will in some cases tip the balance in favour of the suburbs.
"In the suburbs, where you have a minimum of three and in some cases five car spaces for every 100 square metres, everyone can drive to work and the company does not get slugged with the car-parking levy or the same fringe-benefit tax bill."
Investa Property Trust portfolio manager Michael Cook, who controls several CBD office buildings including 120 Collins Street, concedes the tax burden will be passed directly to the tenants.
He says the tax is "soft revenue" and could force smaller businesses away from the CBD.
"It confounds me that Melbourne has done so much to encourage a switch back to the city and now they add another layer of cost for companies to do business there.
"It (the car-parking levy) won't mean shoppers will suddenly race into the city; it doesn't mean it will be cheaper for them to park; it just means it will be more expensive for existing CBD workers to park."
Executive director of the West Australian Property Council Joe Lenzo says the introduction of the Perth Parking Management Area - a similar impost on CBD parking - contributed to a major exodus from the city centre.
"We did a survey 12 months after the introduction of the tax and it showed an abnormally high number of CBD companies that had moved to fringe suburbs, and the parking levy was definitely a factor," he says.
Mr Lenzo says several businesses had relocated to Subiaco, Belmont and the fringes of East Perth, which had led to increased traffic congestion in the suburbs.
He says the levy has been increased on four occasions - from $78.50 to $180 per car - and has become a revenue-raising exercise rather than a measure to combat traffic congestion.
According to a recent report in The Times, London's controversial congestion tax had also contributed to a "corporate diaspora" and significantly reduced the city's vibrancy.