2018-05-22 Special Meeting Agenda

SPECIAL MEETING REPORT                                                                            22 MAY 2018


REPORTS


1     PEREGIAN BEACH DIGITAL HUB – BUILDING TENANCY AND TENDER 1718T127

Author            Manager Economic Development, Anthony Dow
                  Environment and Sustainable Development Department

Index             ECM/ Subject/ Economic Development

Attachments       1.    Crowe Horwath Probity Letter
                  2.    Tender Assessment Detailed Information Sheet – Confidential
                        (This attachment was considered in closed session in accordance with Section 275 (1) of the Local
                        Government Regulation 2012, which permits the meeting to be closed to the public for
                        business relating to the following:
                        (e) contracts proposed to be made by it
                        (h) other business for which a public discussion would be likely to prejudice the interests
                             of the local government or someone else, or enable a person to gain a financial
                             advantage



EXECUTIVE SUMMARY

In December 2017, the Peregian Beach Digital Hub (Digital Hub) Establishment Phase
Implementation Plan was adopted by Council.

In early March 2018, Council approved a revised tenancy process for the Digital Hub and Chris
Boden joined Noosa Council as Digital Hub Director. Chris is now managing the implementation
plan, based at the Digital Hub.

Following the report outlining the tender process presented to Council in March, a tender for private
office tenancies and a registration of interest for co-workers was completed.

In aggregate, the responses validate the market need for a technology-focused Digital Hub. The
targeted marketing campaign successfully attracted interest from 58 technology businesses and
entrepreneurs (5 via tender and 53 via registration of interest) employing around 50 people, with
forecasted growth to 75 jobs within a 12-18 month period.

Based on the response, the tenancy mix is expected to comprise private office tenancies for one
‘Established’ and three ‘Emerging’ technology enterprises on the upper floor and approximately
twenty co-work memberships for individual entrepreneurs on the ground floor.

Factoring this proposed tenancy mix into the Hub’s financial projections indicates that the net
position forecast for the 2018/19 year is anticipated to be within the range outlined in the December
2017 Council report (refer to Finance Section).

The loss of prospective tenants to other hubs through the tender process and the rental rates
proposed in the responses are indicative of a highly competitive environment where a small
number of promising technology companies are in demand both for their tenancy and job creation
potential.

The key risk for this project is losing the qualified respondents due to delays or alternative location
competitive offers. The recommendation to award this tender and delegate final lease negotiations
on terms and rental offer will assist in mitigating this risk.


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