The NSW Government will go to court over its plans to compulsorily acquire land from a company whose chairman happens to be a famous property rights expert.

Professor John Sheehan is director of the Asia-Pacific Centre for Complex Real Property Rights at the University of Technology Sydney and a former acting commissioner of the Land and Environment Court.

He’s also the chairman of $40 million property investor Desane Group Holdings (ASX:DGH).

So it’s perhaps not that surprising that a move by the NSW Government to take one of Desane’s properties by force has ended up in court.

Desane this week lodged urgent proceedings to block the Roads and Maritime Services agency (RMS) and Sydney Motorway Corporation from compulsorily acquiring one of its properties in the Sydney suburb of Rozelle. The agencies want the land to build part of the multi-billion dollar WestConnex motorway.

In an interview with Stockhead, Professor Sheehan said his extensive knowledge of property rights was simply a coincidence.

“We’ve never had any of our property ever taken by compulsory acquisition, this is the first time,” he said.

“It just so happens that I have expertise in the area of compulsory acquisition, quite separately from my role as chairman of Desane.”

At the heart of the dispute, which has been going on since May last year, is how much the government is prepared to pay for the land.

RMS has offered to pay $18.4 million for the 5200sq/m property on Lilyfield Road, which is market value. However Desane wants compensation for $100 million.

Professor Sheehan said the company had owned the land for many years and planned to build as many as 200 apartments as well as retail and commercial space overlooking Blackwattle Bay.

An artist’s perspective of the proposed residential redevelopment. Picture: Desane Group Holdings
An artist’s perspective of the proposed residential redevelopment. Picture: Desane Group Holdings

“We’ve known for some years the property had increasing potential as a redevelopment site for and we were looking at the property for some years. In fact in 2013 we approached our architects to start to prepare a master plan and rezoning application which was lodged well before WestConnex ever approached us.”

In an update to the market on August 4, Professor Sheehan said there were other “sensible” alternatives to acquiring the property that would benefit both RMS and Desane.

“It is our board’s view and that of our expert consultants, that the compulsory acquisition of our property is an overreach by RMS and is contrary to the public interest. We believe the acquisition does not optimise the existing use of the vast area of publically owned and readily available land neighbouring our property,” he said.

The matter will appear in the Supreme Court of NSW next Wednesday August 16.

Update (August 17): The Supreme Court of NSW has set a hearing date November 20 2017 for the case.