2. Proposed Fitout of New Leased AFP Premises at 140 Lonsdale Street, Melbourne, Victoria

The Australian Federal Police (AFP) seeks approval to proceed with an office fit-out for their Melbourne State Office in new leased premises located at 140 Lonsdale Street in Melbourne, Victoria.
The AFP undertakes a range of law enforcement activities at state level, working closely with its state counterparts including Victoria Police (VicPol). According to the AFP, these activities include support of operations, capability and capacity.1
In its submission, the AFP states that:
Within the AFP’s property portfolio, State Offices are maintained to lead and coordinate the functions within their jurisdictions. State Offices are required to be fit-for-purpose and accommodate the AFP resources allocated to prosecute operations and therefore must be carefully considered.2
The estimated cost of the project is $98.43 million (excluding GST).
The project was referred to the Committee of the 45th Parliament on 21 February 2019. This inquiry lapsed with the dissolution of the House of Representatives on 11 April 2019. The project was re-referred on 10 September 2019.

Conduct of the inquiry

Following referral and re-referral, the inquiry was publicised on the Committee’s website via media release.
The Committee received one submission and one confidential submission. A list of submissions can be found at Appendix A.
On 1 April 2019, the Committee conducted a site inspection by presentation, public and in-camera hearings. A transcript of the public hearing is available on the Committee’s website. Following re-referral in the 46th Parliament, the Committee determined that further hearings were unnecessary.

Need for the works

The AFP told the Committee that its current Melbourne State Office (MSO) is located at 383 La Trobe Street in Melbourne’s central business district. The lease at these premises expires in December 2022, and according to the AFP:
…the building owner has advised they will not extend the lease beyond this date. Consequently, the AFP has undertaken a rigorous analysis of accommodation options for the MSO and now proposes to relocate to 140 Lonsdale Street, Melbourne.3
In its submission, the AFP outlined some key considerations that needed to be taken into account in identifying a suitable location for the new MSO:
The AFP operates 24 hours a day, 365 days per year and are an integral function of maintaining a safe Australian community environment. AFP operations must be able to continue undisrupted through adverse weather events, civil unrest, services outages (power and communications), and other events including acts of terrorism. Ensuring operational capability, integrity and redundancy is of paramount importance to the AFP’s capability to maintain a safe Australian environment.4
Further, the AFP stated that the ‘increasing frequency of threats and attacks on police’ has raised the ‘security of AFP members’ as a paramount consideration and driver of the need for ‘enhanced security’.5
The Committee is satisfied that the need for the works exists.

Options considered

In selecting 140 Lonsdale Street as the location for the proposed works, the AFP undertook a competitive procurement process which began in July 2014:
The AFP invited expressions of interest (EOI) and leasing proposals based on its business requirements and selection criteria covering quality, size and location of the premises and economic considerations including best value for money.6
The initial procurement process did not identify any suitable premises. Following this determination, according to the AFP:
A sublease within VicPol’s new tenancy at 311 Spencer Street was presented to the AFP and extensive due diligence was conducted which led to the execution of a Memorandum of Understanding.7
However, in early 2018:
The further evaluation of documents and the design development process identified risks and capability deficiencies relating to space limitations, compromised functionality, lack of visibility into key lease terms, and an inability to influence the tender and design processes led to its removal from further consideration.8
This in turn led to a third procurement process, which commenced in 2018. The AFP explained this process:
A market scan was conducted to search for potential buildings which met the AFP’s updated criteria. Four options were evaluated in detail with consideration for both financial and non-financial outcomes to determine an overall suitability and ranking.9
Of these four proposals, one option ‘met the majority of the AFP’s evaluation criteria’, and as a result 140 Lonsdale Street was selected at the preferred option.10

Scope of the works

In its submission, the AFP states that it ‘intends to lease a purpose-built tenancy within a newly developed precinct’ of 21,500 square meters of dedicated tenancy space for a period of 30 years, with two additional five year options.11
The scope of the office fit-out component includes:
Activity based workspace with shared facilities;
Functional workspaces allowing for 561 occupants to utilise workstations installed in a generally open plan arrangement with functional areas located, segregated and controlled to support operational policing requirements;
Operational rooms and briefing facilities;
Specialist laboratories and workshops;
Secure storage;
Interview rooms;
Firing range;
Operational lockers;
Specialist capability and functional operational policing training areas;
Breakout and muster spaces;
Meeting rooms and muster area;
Communications/server rooms;
Shared facilities including conference and training rooms, gymnasium and media centre;
End-of-trip facilities; and
Amenities area.12
A range of base building works are required to meet the AFP’s requirements, including mechanical services, hydraulic services, electrical services, fire protection and specialist information and communications technology services.13
The AFP discussed its specific security requirements, noting that the security measures need to ensure:
Compliance with ASIO’s and AFP’s respective policies and frameworks.
Adoption of a consistent Operational Security Management Plan across the building premises to ensure currency of the security measures at the site.14
Three of the key security priorities that informed the assessment of security requirements included:
Improved explosive device (IED) protection. Strengthening of facilities to increase protection against IED attack.
Intruder resistance protection. Strengthening intruder resistance (both pedestrian and vehicle) at points of entrance at the facilities.
System response capability. Systems that provide the capability to respond rapidly and effectively to an event.15
The Committee examined the issue of security requirements in more detail in the in-camera hearing, and is satisfied that the need has been adequately addressed. Moreover, the Committee finds that the proposed scope of works is suitable for the works to meet its purpose.

Cost of the works

The project has a budget of $98.43 million, exclusive of GST. It includes a lease incentive of $63.43 million from the landlord.
The AFP provided further detail on project costings in its confidential submission and during the in-camera hearing.
The Committee is satisfied that the costings for the project provided to it have been adequately assessed by the proponent entity.

Committee comment

The Committee did not identify any issues of concern with the proposal and is satisfied that the project has merit in terms of need, scope and cost.
Having regard to its role and responsibilities contained in the Public Works Committee Act 1969, the Committee is of the view that this project signifies value for money for the Commonwealth and constitutes a project which is fit for purpose, having regard to the established need.

Recommendation 1

The Committee recommends that the House of Representatives resolve, pursuant to Section 18(7) of the Public Works Committee Act 1969, that it is expedient to carry out the following proposed works: proposed fit-out of new leased Australian Federal Police Premises in Melbourne Victoria.
Proponent entities must notify the Committee of any changes to the project scope, time, cost, function or design. The Committee also requires that a post-implementation report be provided within three months of a project’s completion. A report template can be found on the Committee’s website.
Hon Dr John McVeigh MP

  • 1
    Australian Federal Police, Submission 1, pp. 5-6.
  • 2
    Australian Federal Police, Submission 1, p. 6.
  • 3
    Australian Federal Police, Submission 1, p. 4.
  • 4
    Australian Federal Police, Submission 1, p. 6.
  • 5
    Australian Federal Police, Submission 1, p. 6.
  • 6
    Australian Federal Police, Submission 1, p. 7.
  • 7
    Australian Federal Police, Submission 1, p. 7.
  • 8
    Australian Federal Police, Submission 1, p. 7.
  • 9
    Australian Federal Police, Submission 1, p. 8.
  • 10
    Australian Federal Police, Submission 1, p. 8.
  • 11
    Australian Federal Police, Submission 1, p. 8.
  • 12
    Australian Federal Police, Submission 1, pp. 13-14.
  • 13
    Australian Federal Police, Submission 1, pp. 15-16.
  • 14
    Australian Federal Police, Submission 1, p. 11.
  • 15
    Australian Federal Police, Submission 1, p. 12.

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