To facilitate continuous improvement in asset management performance across the NSW Public Sector, the Government Asset Management Committee (GAMC) has endorsed a range of reforms to improve the lease negotiation and management processes for the provision of office accommodation.

This Memorandum outlines the reforms that will apply to all budget sector government agencies from 1 July 2002. These reforms and this Memorandum supersede the leasing provisions outlined in Premier's Memorandum 97-02 (PM 97-2)

Multiple Leases in the same Building/Crown Property Portfolio
Where multiple leases exist in the same building in the Sydney CBD and fringe, Parramatta, Lower North Shore or where the total space occupied by multiple agencies in a building in other locations exceeds 4,000m², they are to be incorporated into the Crown Property Portfolio (CPP). If, in the future, the leasing activities of agencies result in multiple leases existing in the same building, in the nominated markets, they will also be incorporated into the CPP.

The CPP is currently managed by the Department of Public Works and Services (DPWS) on behalf of Treasury and it provides a complete lease negotiation and management service for its tenants. DPWS staff will contact affected agencies to discuss the role of the CPP and make the necessary transition arrangements to enable implementation from 1 July 2002 .

Further information about the CPP and its services is available at the GAMC website.

Single Leases/Government Leasing Service In relation to single leases, a centralised Government Leasing Service (GLS) is being established by the Policy Services Division of DPWS (PSD) to conduct lease negotiations on behalf of agencies in the Sydney CBD and fringe, Parramatta, Lower North Shore, or where a tenancy exceeds 1,000m² in other locations.

The GLS will provide agencies with a professional lease negotiation service and its performance will be closely monitored by the GAMC. Agencies remain responsible for decisions in relation to service delivery, such as location, required profile, fitout, etc, in accordance with prevailing Government office accommodation policies. They are also responsible for obtaining the necessary internal and funding approvals and for the ongoing lease management.

Overall coordination of the GLS will be the responsibility of DPWS(PSD) and agencies will directly engage DPWS lease negotiators to act on their behalf in the lease negotiation process. The fees for this service will be as approved by the GAMC. Any disputes or dissatisfaction with the service provided should be reported to DPWS(PSD) immediately.

Where agencies consider they have the necessary inhouse expertise to conduct their own negotiations, application may be made to the GAMC for exemption from the GLS. Exemption criteria are described in the detailed outline of the GLS which is available at the GAMC website.

DPWS(PSD) remains responsible for the coordination of leasing across the State and, therefore, for all leases outside the markets of the GLS, agencies are still required to obtain the approval of DPWS(PSD) to any changes in leasing arrangements.

To ensure that priority is given to available Government office space and that agencies are not competing for the same space in the market, all agencies must advise DPWS(PSD) before they make any approach to the market for new accommodation in any location. Agencies should also advise DPWS(PSD) immediately of any vacant or underutilised office space.

In relation to the preparation of facility plans, from 1 July 2002 agencies are required to prepare a facility plan and submit it to DPWS(PSD) when entering into a new or renewed lease for premises over 1,000m² in any location. For office accommodation below 1,000m² a space analysis calculation, as shown in the Office Accommodation Workspace Guidelines Workbook (www.gamc.nsw.gov.au) should be provided to DPWS(PSD) when seeking approval to renew a lease or take out a new lease.

Minister and CEOs should ensure that all inner and outer budget sector agencies for which they are responsible are aware of and comply with these reforms in lease management and negotiation. They should also ensure that the reforms are brought to the attention of all Government Trading Enterprises and State Owned Corporations and that, where the necessary inhouse expertise is not available, they be encouraged to utilise the services of the Crown Property Portfolio or the Government Leasing Service, as appropriate.

Bob Carr
Premier