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Coburg plan collapses

THE much touted $1 billion, 20-year Coburg revitalisation plan, one of Melbourne's biggest urban regeneration projects, has been dealt a body blow.

THE much touted $1 billion, 20-year Coburg revitalisation plan, one of Melbourne's biggest urban regeneration projects, has been dealt a body blow.

Moreland City Council has cancelled its partnership with its preferred developer, Lorenz Grollo's Equiset, which, angered, is considering legal action.

Equiset was enlisted three years ago as a private partner in the grand Coburg vision, which was estimated to create $1 billion in investment over 20 years transforming 35 hectares around the Sydney Road and Bell Street intersection into a vibrant hub.

The five-volume Coburg Initiative masterplan, released last November, was expected to create 9800 jobs and pour $3.2 billion each year into Coburg's economy, turning the suburb into Melbourne's "northern gateway".

The blueprint outlines plans for 5800 new homes, four public town squares and almost 360,000 square metres of more floor space in central Coburg.

The plan also envisaged redeveloping the area around the railway station and sinking the rail line underground.

The massive sea of car parking that dominates central Coburg would also be banished underground and replaced with green spaces for people to gather.

Explaining its decision, Moreland said it could not reach an acceptable financial agreement that would deliver the plan.

"It [Equiset's partnership] has given us confidence that this project has the right ingredients to be a great success," the mayor, Oscar Yildiz, said.

"However, we need to ensure we can deliver it using a financial model that does not present a financial risk for the current and future communities."

Mr Yildiz said the council would consider its next steps, which included further talks with the community about the project and some additional work on the financial model.

Equiset managing director Lorenz Grollo said the company rejected the council's decision to terminate the partnership agreement, and the inadequate reasons proffered to justify the decision. "Equiset is exploring its rights and considering its options, including legal action, in response to the council's decision," he said.

"The group has acted transparently and openly, in good faith, at all times during the three years it has been involved in the project."

The company and its consultants have employed more than 30 people on the project for three years.

The agreement's collapse follows the scrapping this month of another key part of the revitalisation plan, Healthscope's $150 million hospital in Bell Street. Instead, Healthscope will spend $35 million on its existing John Fawkner Private Hospital in Moreland Road.

Mr Grollo said Moreland's decision, and the recent record of cancelled developments in Coburg, called into question the ability of local authorities to work with the private sector in urban renewal projects.

Equiset was disappointed with the decision, not just for itself, he said. "We are particularly disappointed with now not having the opportunity to deliver on the community's aspirations for Coburg."

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