The Carroll government will be forced to pay over $50 million in compensation to the City of Boroondara for land seized for the North East Link. The land, which housed the former Boroondara Tennis Club, was valued at $30.1 million by the State, but the council argued it was worth $58 million based on its potential for residential development.
The 3.7 hectare site had 23 tennis courts, a clubhouse, café, offices, and parking, and was subject to a Public Use Zone and a Land Subject to Inundation Overlay. Despite this, the council sought a higher valuation, which the court ultimately accepted, awarding $49.69 million.
A 40 per cent discount was applied to the market rate due to restrictions on the land, and an additional $185,000 was awarded for rent lost from a mobile phone tower. The council also received $150,000 in solatium, which is compensation for intangible disadvantage arising from compulsory acquisition, and $161,000 in professional fees, bringing the total to $50.19 million.
The award is understood to be the first time a Victorian council has received solatium – compensation for intangible disadvantage arising from compulsory acquisition rather than compensation for the market value of the land itself. The court accepted that the compulsory acquisition caused the council an intangible disadvantage beyond the financial value of the property. The former tennis centre closed in 2022 to make way for the North East Link, and an 18-court replacement facility was established at Glen Waverley.
Originally due to be completed in the fourth quarter of 2026-27, it is now scheduled to open in the second quarter of 2028-29 – a delay of six quarters, or one and a half years, according to the Victorian Auditor-General’s Office. The cost has also risen from $15.64b to $26.21b, an increase of 67.58 per cent, according to the Victorian Auditor-General’s Office.
The AG added the State has not formally reassessed the project’s benefit-cost ratio to reflect the changes in scope and cost. The City of Boroondara will receive the compensation for the seized land, and the North East Link project will continue with its revised completion date and increased cost.
