Most of the project objectives as detailed in the business case were achieved, with the exception that the project was not completed within the original time frame.
The final global settlement agreement between the State and the private parties dealt with the 15-month delay in the project, and while there were some costs incurred by the State in the settlement, the benefits outweighed the potential costs.
The global settlement agreement was negotiated to minimise adverse impacts on the State's original cost expectations for the redevelopment. This was achieved by:
• a rigorous and structured negotiation process overseen by an interdepartmental committee
• use of independent experts to assist in legal, commercial and financial risk assessments to determine the State's actual liability and potential risk exposure
• persuading the concessionaire to contribute a fair and significant cash payment to the settlement
• avoiding lengthy litigation and legal costs estimated by the SCSA's legal advisers to potentially exceed $200 million.
The agreement resulted in some risks being allocated to the State that were not consistent with the desired risk allocation, namely:
• payment of $8.5 million for settlement of non-contractual claims by the developer for which it did not admit liability
• relieving the concessionaire from paying damages for not meeting construction milestones
• provision of a $20 million non-cash benefit to the concessionaire resulting from the SCSA agreeing to pay the capital core service payment component backdated from the original scheduled completion date, rather than from the date works were actually completed.
However, these measures were considered necessary to settle the developer's claims and ensure that the additional costs to the State were minimised. In addition, at least part of the delays encountered by the developer were, in part, a result of site contamination (for which the SCSA was liable) and some State-initiated modifications.
The final settlement between the State, the concessionaire and the developer thus effectively concluded all remaining disputes and claims arising from the construction phase of the project.