Port of Melbourne. Image: Chris Phutully
The Victorian government made a landmark lease that will place the Port of Melbourne under the operation and management of a private consortium.
Under the deal, the Lonsdale Consortium, comprising of the Future Fund, QIC, GIP and OMERS, has signed a lease that will allow it to head up the port’s commercial operations for a term of 50 years.
The lease is valued at more than $9.7 billion dollars, which the state government said reflects strong bidder interest and the port’s value as the biggest container and cargo port in Australia.
According to the state government, each member of the consortium is a highly experienced asset owner who will ensure the ongoing operation integrity of the Port of Melbourne.
The government said that Lonsdale will also bring greater access to capital to ensure the ongoing development of the Port of Melbourne, ‘further enhancing Victoria’s reputation as the leading port in Australia’.
It’s not all heading to the Lonsdale Consortium, however, the state government plans to retain responsibility for the Harbour Master, Station Pier, relevant safety and environmental regulation, waterside emergency management and marine pollution response.
During the lease term, Lonsdale will maintain access to public walkways and bike paths for community use.
The government has assured that commercial and recreational vessels’ access will not be affected by the lease, with the port being returned to public hands at the end of the lease.
A major part of the lease is that the income will go toward big projects meant to help improve the state’s infrastructure, including ten per cent of lease proceeds will be invested in regional and rural infrastructure projects, totaling more than $970 million.
Victorian Premier Daniel Andrews said this is a $9.7 billion vote of confidence in the Victorian economy.
Victorian Treasurer Tim Pallas said the strength of this result underlines the continued high performance of the Victorian economy – the fastest growing in the country.
“Leasing the port reinforces Victoria’s position as the freight and logistics capital of Australia and will make a great port even better,” Mr Pallas said.
Victorian Minister for Ports and Acting Minister for Regional Development Luke Donnellan through this lease, “we are supporting our State’s vibrant regional communities, putting infrastructure and agriculture back at the heart of Victoria’s economic development”.
Chairman Port of Melbourne Corporation Mark Birrell this is a great result for Australia’s largest maritime trade hub and reflects the port’s vital role in the State and national economies.
