THE Rann Government is defying criticism over the sale of prime land in central Adelaide to the Catholic Church, rejecting suggestions of a "sweetheart" deal. The site in Victoria Square, formerly a tram depot, was sold to the Catholic Church Endowment Society for $5.87 million under a contract signed in 2004, when the market value was $1.55 million higher.
Property industry figures have raised concerns about the deal, with questions asked in parliament about the negotiations and whether the second-most senior church figure in South Australia, Monsignor David Cappo, was involved.
Mike Rann appointed Monsignor Cappo to the state's Social Inclusion Board in 2002, and the priest became a non-voting member of the cabinet in mid-2005.
A spokeswoman for the Premier said yesterday there was "nothing untoward" in the land deal, and she did not believe Monsignor Cappo was personally involved.
"The Government just can't sell things on a sweetheart deal," she said. "It's got to go through a public service process.
"Everything was above board, everything went through cabinet. It went through the entire processes of the public service, as all of these sales do."
The Catholic Church Endowment Society has developed the 6200sqm site into a six-star environmentally friendly building, which is due to be completed in September.
State government utility SA Water will lease eight floors of the building, at an expected cost of more than $121 million over 15 years.
The Victoria Square development is part of a strategy to boost the church's income from its property holdings.
Senior property industry figures have told The Australian of doubts about the way the initial deal for the site's sale was "done and dusted".
Liberal MP Rob Lucas has lodged a number of Freedom of Information requests for documents relating to the sale, in response to concerns raised privately with him.
"There are a number of people in the industry who have been complaining about the deal and have been complaining about the process," he said.
Mr Lucas has asked in parliament whether Monsignor Cappo discussed the sale with any government member or relevant public servant before the successful church offer for the site.
He is yet to receive an answer from the Government.
"The fact this is taking a long time is concerning me," Mr Lucas said. "That just prompts further curiosity."
Monsignor Cappo was unavailable for comment.
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