Dreamworld Productions Pty Ltd v Chief Executive, Department of Lands [1994] QLC 247

[1994] QLC 247 LAND COURT BRISBANE 21ST SEPTEMBER 1994 Re: Appeals against unimproved valuations - Shire of Albert - V94-23; AV94-79 and AV94-80 Dreamworld Productions Pty Ltd v. Chief Executive, Department of Lands D E C I S I O N Dreamworld Productions Pty Ltd is the registered proprietor of two parcels of land, situated on either side of Dreamworld Parkway at Coomera. The "main parcel" contains an area of 73.58 hectares, being land described as Lots 1 to 3, RP 138841, Lot 3 on RP 15230, Lot 12 on RP 835941 and Lot 1 on WD 5140, Parish of Coomera. Except for Lot 12, of 3.986 hectares which is zoned "Future Urban", the land in the main parcel is zoned "Special Facility (Theme Park)". About 20 hectares of this land has been developed as the landmark tourist attraction -"Dreamworld". The unimproved valuation of the main parcel, under the provisions of the Valuation of Land Act 1944, as at 31st March, 1992 was assessed by the Department of Lands in the amount of $5,000,000 (V94-23) then in the amount of $5,900,000 as at 30th June, 1993 (AV94-79). The smaller parcel, on the western frontage of Dreamworld Parkway, adjacent to the eastern frontage of the Pacific Highway, contains an area of 10.02 hectares being land described as Lots 1 and 2 on RP 186505, Parish of Coomera. This land is also zoned "Special Facility (Theme Park)". It is partially developed as the Dreamworld car park. The Department of Lands unimproved valuation of this land as at 30th June, 1993 was $1,250,000 (AV94-80). Appeals were filed against each of the valuations, on broad all-embracing grounds. The appellant company's estimate of the unimproved value of the main parcel at both relevant dates, was $3,500,000 and the smaller parcel $850,000 at the later relevant date. -- 1 of 17 -- 2 On application, an Order had been made for the exchange of valuations and supporting data. At the commencement of the hearing, it was confirmed that the Department's valuation approach had included consideration of the potential of the main parcel of the subject land for development as a residential subdivision. Supporting data for the valuations of the main parcel included "detailed hypothetical development reports" which included estimates of development costs not only for the subject property but for one of the "comparable" sales. Counsel for the appellant company called, as the first witness, Mr D.T. Kleimeyer, an engineer, whose experience included residential subdivisional developments in the locality of the Dreamworld property. He had been involved with the engineering aspects of the proposed "Coomera Woods" residential development immediately to the north of Dreamworld. I do not propose to deal with Mr Kleimeyer's evidence at length. However, he had given consideration to the Department of Lands hypothetical residential development proposal for the main Dreamworld site. In his opinion, rezoning of that land would have at the relevant dates of valuation, required the upgrading of existing water and sewerage mains, external to the site, at estimated costs of $570,548 and $604,582 respectively. In addition, headworks charges for water and sewerage would have totalled $4,828.80 and $4,937.60 per equivalent three bedroom dwelling as at 1st July, 1992 and 1st July, 1993 respectively. His evidence was that, based on other residential developments in the general locality, civil engineering costs could be expected to range between $18,000 and $20,000 per lot for internal development, excluding engineering fees ($1,400 estimate), survey fees ($600 estimate), any headworks charges and external works such as the abovementioned upgrading of the water and sewerage supply, together with contributions to roadworks and drainage of an extra-ordinary nature, but peculiar to the specific site. Mr Kleimeyer saw the potential for the Council to seek contribution towards the cost of upgrading the Foxwell Road/Dreamworld Parkway intersection. His verbal evidence was that associated drainage costs could be in the range of $250,000 together with contribution towards a roundabout in a similar amount. -- 2 of 17 -- 3 Valuation evidence for the appellant company was called through Mr B.B. Kelaher. He valued the main parcel in the amount of $3,300,000 as at both relevant dates. In his opinion the highest and best use of the main parcel was as predominantly zoned, for its existing use as a theme park. In his tendered report he described the land as comprising about 25 hectares of level land in the southern section which had been intensively developed as the Dreamworld Theme Park, about 15 hectares of low swampy central section cut by a "multi-strand creek", into which low intensity theme park usage had spread, then about 33 hectares in the northern section of which about 10 hectares was low lying, mostly natural forest providing feed and habitat for the "Dreamworld Koala Colony". Mr Kelaher's valuation approach was to consider any sales evidence he thought relevant, together with the relativity between the valuation of the subject land and other lands in the vicinity, with similar existing or potential highest and best use. After examination of "a large number of sales" he found none which he considered "directly" comparable and he found it necessary to "analyse all the sales and then aggregate the analyses to arrive at a value or sectionalised version of Dreamworld's value". He provided a schedule of six sales the comparability of which he rated in descending numerical order with a summary of the details as follows: Sale 1 - Pacific Highway, Old Pacific Highway, Copeland Street, Jacobs Well Road and Yawalpah Road - 22.6 hectares - zoned "Local Business" and "Special Residential" - with Council approval to proceed with such a project. The land sold on 6th July, 1992, for $2,050,000 or approximately $90,000 per hectare. Mr Kelaher made the following comparison - "In the centre of the Town of Pimpama and well situated for a local shopping centre and unit development. Elevated and with a slope from east to west. Outstanding access and visibility - no permitted access direct to the Pacific Highway. Higher use and superior to the subject." According to Mr Kelaher, the Department of Lands valuation in 1992 was $223,000 remaining unaltered in 1993. Sale 2 - Pacific Highway, Oxenford - 2km south of subject property - 9.816 hectares - zoned part "Special Facilities - Service Station"; part "Light Industry" (one-third); -- 3 of 17 -- 4 part (about two-thirds) "Future Urban". According to Mr Kelaher there was subsequent to the date of sale, a rezoning application for mixed density residential use additional to the service station. Mr Kelaher described the land as level, falling to creek at rear, with about half the land filled to a depth of about 2 metres consolidated, encumbered by a stormwater drainage easement which would need to be piped for full development. The land fronts a "service road" adjacent and parallel to the highway. He stated that a "provisional application to develop the land for Light Industry was rejected by Council". He described the land as being "comparable to the subject but smaller frontage to the highway. Creek at rear with drainage problems". The land was sold on 20th May, 1993 for $500,000 or approximately $50,000 per hectare. Mr Kelaher stated that the Department of Lands valuation in 1992 had been $2,700,000 then reduced to $500,000 in 1993. Sale 3 - Pacific Highway, Ormeau, 24.11 hectares - zoned "Special Purposes -Commercial and Industrial" - on eastern side of highway with the new railway at the eastern boundary, Half Way Creek as northern boundary, improved with relatively new low-set brick house. The property sold on 11th March, 1992 for $1,000,000, the sale analysed by Mr Kelaher to show an unimproved value of $38,000 per hectare. The land was valued by the Department of Lands in both 1992 and 1993 in the amount of $960,000 or approximately $40,000 per hectare. Mr Kelaher described the land as "similar to the subject, almost identical frontage to the Pacific Highway. Situated near major development and industrial area (including brewery). Overall slightly inferior. Sale 4 - Michigan Drive (and other streets) Oxenford - 5 km from subject property - 79.7 hectares - partly zoned "Residential A" - balance area of existing residential subdivision - western section zoned "Rural B". The property was described by Mr Kelaher as being in close proximity to two quarries but "elevated with outstanding views, falls in undulating ridges to the north-east. Inferior to the subject." The land sold on 1st July, 1992 for $2,000,000 and was valued by the Department in 1992 in that amount and then subsequently subdivided. Sale 5 - Koala Town Resort (defunct) - Pacific Highway and Heathwood Drive, Coomera - 300 metres frontage to Coomera River - 700 metres frontage to Yaun Creek - 1 km from subject land - 14.48 hectares zoned "Special Facilities - Theme Park:. Mr Kelaher said the land was used as the "Koala Display Theme Park" at the time of purchase, with approval in principle for rezoning and development with 202 residential units. It sold on 23rd October, 1992 for $2,150,000 showing, on Mr Kelaher's analysis, an unimproved value of $109,000 per hectare. The Department's valuation in both 1992 and 1993 was $2,555,000 or $176,000 per hectare. -- 4 of 17 -- 5 Mr Kelaher's report described the recent history of the development of the site as a theme park, then its sale for residential redevelopment. The existing buildings were removed at an additional cost to the purchaser, of $50,000. In his analysis of the sale, it seems that Mr Kelaher ignored the additional costs involved in preparation of the site, due to some arrangement between the purchaser and an associated person, whereby there should have been an offset of cost rather than additional cost. Mr Kelaher allowed an amount of $350,000 for the "massive filling" after doing the best he could on what he had been told as to the areas filled and the depth of fill. He also allowed an amount of $206,000, "to bring water to the site" (it seems when the theme park had been developed). In his opinion the sale land "is very much superior to the subject property because of its extremely long double water frontages and having services can `wait out' the arrival of the Council services whilst proceeding with stage development." Mr Kelaher considered that because of its complexity, the sale "has limited application". Sale 6 - Clarence Drive - between Helensvale residential and Saltwater Creek - "just short of Coomera River" - 29.82 hectares - zoned "Rural A" - 4,000 sq. metre blocks - all services available - sold 19th June, 1992 for $1,950,000 - analysed by Mr Kelaher to show $63,000 per hectare - Department of Lands valuation 1992 $1,850,000 or $61,500 per hectare - subdivided in 1993. Mr Kelaher described the land as being "well placed behind Helensvale and with river on north side. Land consists of a series of ridges falling smoothly to Saltwater Creek (which is, in fact, a river with running water about 60 metres in width). Elevated outstanding views - about 40 per cent water frontage - navigable for large sized boats to the open sea." Mr Kelaher saw certain relativity comparisons as clearly indicating that the valuation of the main Dreamworld property was too high. These examples were given as follows: (1)Movieworld - 5 km south - major Pacific Highway frontage - 164.3 hectares - zoned "Special Facilities - Theme Park (etc)". Department of Lands Valuations: 1990 - $8,200,000 ($50,000 per ha) 1992 - $8,200,000 ($50,000 per ha) 1993 - $9,000.000 ($55,000 per ha) Mr Kelaher says this land is superior to Dreamworld, both physically and with regard to accessibility and highway exposure, but of obviously larger area. (2)Coomera Resort land - Pacific Highway, Foxwell Road - on opposite side of -- 5 of 17 -- 6 Foxwell Road to subject land - 381.8 hectares - zoned "Special Facilities - (golf course, multi unit residential, high rise hotel and commercial/industrial uses.)" Department of Lands Valuations: 1990 - $19,000,000 ($50,000 per ha) - 381.8 ha 1991 - $18,700,000 ($50,000 per ha) - reduced area 1992 - $15,000,000 ($40,000 per ha) - 373 ha 1993 - $15,000,000 ($40,000 per ha) - 373 ha Mr Kelaher commented that this land was "overall superior to the subject but larger area" and the "zoning is superior". He referred to a sale of the land in November 1989 and September 1991 for prices equivalent to $57,000 per hectare and $70,000 per hectare respectively. It was his opinion that there were unreal expectations in relation to both purchasers "and this is reflected in the fact that the Valuer-General totally abandoned both sales for valuation purposes". (3)Aircraft Museum Site - directly opposite side of Pacific Highway - 38.5 ha - zoned "Special Purposes - Aircraft Museum" - Queensland Technology and Transport site. According to Mr Kelaher the land was valued at $19,000 per ha in 1992 and 1993. (4)Pacific Highway, Pimpama - 40.09 ha - zoned "Rural B" - Department of Lands valuation 1992 and 1993, $37,500 per ha. (5)Pacific Highway, Pimpama - 11.86 ha - zoned "Rural B" - Department of Lands valuation 1992 and 1993, $15,000 per ha. (6)(a)Old Coach Road, Coomera - next to Pacific Highway - 77.73 ha - zoned "Special Facilities - Chinese Cultural Centre and accommodation/hotel". Department of Lands valuation 1992 - $4,700 per ha 1993 - $8,000 per ha. (b)Rosemount Drive, Coomera (to rear of (6)(a)) - 40.49 ha - zoned "Rural B". Department of Lands valuation 1992 - $3,250 per ha 1993 - $6,000 per ha. (7)Yawalpah and Kerkin Roads - 65.96 ha - zoned "Special Facilities - golf -- 6 of 17 -- 7 course etc." Department of Lands valuation 1990 - $5,500 per ha 1992 - $7,000 per ha. (8)Pacific Highway, Pimpama - 7.732 ha - zoned "Special Facilities - Theme Park" - (Le Mans Mini Car Racing Circuit). Department of Lands valuation 1992 and 1993 - $60,000 per ha. Mr Kelaher says the use of this land is "a very similar operation but much smaller. It is better placed yet it is valued ...... at $8,000 (1992) and $20,000 (1993) per hectare less than the valuations of the subject land." In Mr Kelaher's opinion, there had been no increase in value for land such as the subject in the period between the relevant dates of valuation for the main parcel. He considered that a valuation of $45,000 per hectare overall was a realistic interpretation of the sales evidence and maintained reasonable relativity with the valuations of the other lands in the vicinity. In the alternative, he suggested an apportionment of values as follows: "Dreamworld Proper - 25 ha x $70,000 - $1,750,000 Central Swamp - 15 ha x $15,000 - $225,000 Northern Section - 33 ha x $40,000 - $1,320,000 $3,295,000 Round off to $3,300,000" Mr Kelaher's valuation of the smaller parcel, being the Dreamworld Car Park, was in the amount of $850,000 rounded from a calculation at the rate of $85,000 per hectare. He considered its existing use, associated with its zoning, as part of the Dreamworld Theme Park, represented its highest and best use. Again, his opinion as to unimproved value was formed after consideration of various sales evidence and the question of relativity of valuations. He made reference to six sales previously identified as Sales 1, 2, 3, 5 and 6, in his valuation of the main parcel. The original -- 7 of 17 -- 8 Sale 4 was deleted and another added as follows: Sale 1(A) - Beattie Road - 100 metres from subject land - 4.678 hectares as two surveyed lots - zoned "Special Residential", sold 2nd April, 1992 for $425,000 analysed as showing $90,000 per hectare. In summary, Mr Kelaher found Sale 1 "very comparable, and its superiority is offset by its larger area", Sale 1(A) "smaller but fair comparison", Sale 2 "slightly inferior", Sale 3 "inferior" and Sale 6 "inferior". He found no sales evidence to support the Department of Lands valuation of $125,000 per hectare. From the relativity perspective he felt the "only nearly comparable property" operating as a theme park was Koala Town (Sale 5) but in his opinion the Department of Lands valuation on that land, being $176,000 per hectare, had been proved wrong by being $28,000 per hectare in excess of the actual sale price in its highly improved theme park state. He found the next most comparable property to be the "Le Mans" site (relativity 8 for main property) and that was valued by the Department at $60,000 per hectare being near half the Dreamworld Car Park land valuation. He felt the "Le Mans" site was correctly valued. He again referred to the Department of Lands valuation on his Sale (1) land and relativity Examples (3), (4) and (5). In his opinion, "relativity applied by the Lands Department is haphazard, but no grounds for applying $125,000 ha can be found for the subject property from the facts available". Department of Lands Valuation Evidence Mr P.D. Grennan, a registered valuer employed by the Department, took responsibility for the valuations appealed against although he was not the original valuer. Apart from giving evidence as an expert witness, Mr Grennan, whether by choice or otherwise, also acted as advocate for the Department. It seems that, in his role as a senior valuer with the Department, part of his responsibility in the statutory valuation of in globo lands in the Gold Coast region is to ensure that reasonable relativity of valuations is maintained, particularly where a team of valuers is involved. Dealing first with Mr Kelaher's examples of relativity or lack of it, Mr Grennan suggested that some anomalies were apparent. Although Mr Kelaher's report had -- 8 of 17 -- 9 been exchanged prior to the hearing, Mr Grennan had not had the opportunity of making himself fully familiar with some of the properties involved in Mr Kelaher's basic sales evidence or relativity examples. In his opinion the question of relativity and comparability became largely a matter of opinion except in those cases such as Mr Kelaher's Example (6) where Mr Grennan agreed that the applied valuation seemed too low, and required further investigation. Mr Grennan advised that whether it was correct or not, the land involved in Example (7) had been valued in terms of the legislation, exclusive of potential for higher use. The "valuation" used by Mr Kelaher in Example (3) was not a statutory valuation because the property was a Reserve and not rateable. Mr Grennan advised that the Department of Lands valuation quoted by Mr Kelaher relative to his Sale (1) had been found to be incorrect and had been amended subsequent to Mr Kelaher's research. Mr Grennan's case was that the primary evidence of value in support of the valuations appealed against was provided by two sales, the second of which was Mr Kelaher's Sale (1). It is indicative of the difficulties involved in deciding matters such as this when two valuers, senior in their profession through long practical experience, are influenced by the same basic evidence to arrive at such diverse results. Mr Grennan's first sale was of the large area in Mr Kelaher's relativity Example (2). Brief details of the sale are as follows: Pacific Highway, Foxwell Road and Cunningham Street - 386.6 hectares, zoned "Special Facilities", sold on 27th November, 1989 for $22,000,000 unimproved, or $57,621 per hectare. Mr Grennan had no knowledge of the later sale referred to by Mr. Kelaher and quoted as being for $27,000,000 in 1991. The valuation applied by the Department to this sale land as at both 31st March, 1992 and 30th June, 1993 was $15,000,000 or $40,000 per hectare. (It is observed that the valuation applied, according to Mr Kelaher, in 1990 and 1991, was equivalent to $50,000 per hectare). In the supporting data provided with Mr Grennan's valuation of the main property of the subject land, he had supplied a "detailed hypothetical development report" for this sale property as at both valuation dates. As at 31st March, 1992, after certain necessary adjustments, the in globo value as indicated for the sale land was $31,500 per hectare approximately, when $40,000 per hectare had been applied. As at 30th June, 1993, the same methodology but with adjustments of gross -- 9 of 17 -- 10 realisation and interest rates indicated an in globo value of about $47,000 per hectare but again the $40,000 per hectare had been applied. It was Mr Grennan's evidence that in fact the hypothetical development study had not been carried out for the 1992 valuation for had it been done a lower valuation would have applied supporting then an increase to $40,000 per hectare in 1993. Mr Grennan described the sale land as follows: "Mainly gentle to medium undulating coastal forest ranging in elevation from RL 6 metres to RL 57 metres (AHD) mainly well drained with a low section severed by a watercourse through the south-western corner. 7 km from adequate water. Proposed to commence development June 1994, 277 ha residential subdivision (AV 800m2 lots mainly) possible 36 hole golf course the balance to be held for future development ie about 55 ha tourist and accommodation facilities and a similar area of commercial and industrial park. Electric railway due to commence operations through the site 1995 with Coomera Station at Foxwell Road. Note previous sale 16/10/87 $8,000,000". In comparison to the subject land he made the following comment: "The sale is in close proximity immediately north of the subject land. The sale land is clearly inferior pro rata due to size and access." Brief details of the information provided by Mr Grennan relative to the second sale are as follows: 22.6 ha, zoned 19.6 ha Special Residential, 1.5 ha Special Business, 1.5 ha Local Business - sold 6th July, 1992 for $2,050,000, analysed to show an unimproved value of $90,044 ha - applied valuation of $71,000 ha 31st March, 1992 and $80,000 ha as at 30th June, 1993 (as amended from the information provided by Mr Kelaher). Mr Grennan's details of the sale included the following: "Electricity and telephone available, Yawalpah Road unformed here, above street level, gentle undulations, medium elevation, exposure to Pacific Highway at South-West Corner. Considered suitable for holding for future residential and commercial development." Then in comparison to the subject property: "The sale land has inferior access, roads, services and location but overall is superior pro rata due to size." Mr Grennan was challenged as to the accuracy of his statement as to the formation of Yawalpah Road. He accepted that it may have been an incorrect description although he did not see that as being relevant to the future potential of the site when the external development requirements were considered. He had not -- 10 of 17 -- 11 been aware that construction of a highway overpass access, with consequent improved access to the site, was imminent at the date of sale. (It seems that the overpass was being constructed at the date of hearing). It is Mr Grennan's opinion that no specific market exists for land with "theme park" use, the success or failure of any particular development being related to the actual theme. His contention is that any acquisition of in globo land for theme park development, would be required by market forces to at least meet the level of value for the land as it would otherwise be zoned. It follows, in his opinion, that if the highest and best use of a particular parcel of land was argued to be for theme park use, then that use should command a value higher than land in the zone in which it would otherwise fall. That contention is logical. He stressed that the Department, mindful of the historical failure rate of theme park developments, has not sought to find any premium in value for lands in the subject locality zoned to permit such development. In his opinion the main parcel of Dreamworld would have highest and best use, otherwise than as zoned, associated with the potential of the site for residential development. Mr Grennan's basis of valuation was said to have been obtained from the sales mentioned and while he agreed that the evidence was not ideal, the valuation result had been checked by the hypothetical development analysis. Mr Grennan has obviously given in-depth consideration to the market effectiveness of the methodology to be employed in this exercise. He has specifically investigated and given consideration to matters such as the topography of the land as it influences lot yield, market forces affecting gross realisation, development costs, profit/risk allowance, the appropriate interest rate, the appropriate development and selling period of stages in the overall development and matters associated with holding costs. He is confident that his methodology does in fact reflect the market. Unfortunately no such market evidence was able to be provided to support that confidence. For example, his views as to the profit margin permitted a developer in the Gold Coast region in globo land market, being a standard 331 /3% regardless of the size of a particular parcel and, it seems, the risks of realising profit in individual cases, seem illogical in the absence of -- 11 of 17 -- 12 evidence to support such an opinion. His divergence from hypothetical development methodology accepted by the Court in other matters was criticised by Counsel for the appellant company, but his refinements are not necessarily wrong or offensive to theoretical principles. Similarly, the hypothetical development analysis of sales evidence and its application to the task of checking relativity in valuations may well be a useful method of eliminating some of what he described as the "direct comparison guesswork", based only on broad opinion. The real criticism emerges when the method of valuation by hypothetical development becomes the primary basis particularly in the absence of supporting market evidence. It is well known that relatively minor adjustment to the variable components is capable of creating significant alteration to the end - in globo - result. For this very reason the hypothetical development approach to valuation has regularly drawn adverse comment in both this Court and the Land Appeal Court. In Netanya Noosa Pty Ltd v. The Valuer General the Land Appeal Court (in an unreported judgment delivered on 3rd April, 1992) found it necessary "to consider the suitability of the notional development exercise (or adaption thereto) in arriving at the unimproved value of the land". At pp.8-9 of that judgment the Court said: " Our attention is drawn to various comments in the judgment of the Land Appeal Court in Merivale Motel Investments Pty Limited v. The Brisbane Exposition and South Bank Redevelopment Authority 10 QLCR (1984-85) 268 and the decision of Mr W.F.G. Smith, the President of the Land Court (as he then was) in Thomas Nominees Pty Ltd v. The Valuer-General 11 QLCR (1986-87) 283. The notional development exercise involves well recognised valuation methodology which by its very nature requires the consideration of variable criteria, no doubt many of which are tested by input into the draft calculations before final adoption of the end result by the practitioner. It is also recognised as a check against the potential viability of a development, subject always to the variables and the land component. It is market evidence itself which in the end result must indicate the acceptability of that major variable - the allowance to be made for profit and risk of realisation - in the analytic exercise. If the exercise cannot be tested by reference to a real market it is of no more assistance in establishing market value than the deliberations of a professional valuer seeking to interpret the land value component in the absence of directly comparable sales evidence. Where it is of some assistance in the absence of sales is to test the effect of the variables on the end result." The appellant company here, particularly through the engineering evidence -- 12 of 17 -- 13 called as to estimated development costs and to a lesser degree through valuation evidence as to estimated gross realisation and other variable components, has forcefully challenged the veracity of Mr Grennan's exercise and the end results. Mr Grennan did not precisely apply the results of the exercise. It is evident however, that the increase found as at 30th June, 1993, even if conservatively applied, resulted directly from the hypothetical development exercise as at that date. There is again no in globo market evidence offered to support the validity of the application of the increased valuation. If, as Mr Grennan says, the purpose of the exercise was primarily to ensure reasonable relativity, then again that was not proved. Adequate evidence that the exercise was not applied consistently is provided by the static level of value applied to the land in his Sale No. 1 from 31st March, 1992 to 30th June, 1993. Mr Grennan said that the static valuation was the result of the exercise not having been employed for the 1992 valuation of the sale property land, which valuation,in hindsight, was too high. That in itself, further weakens the evidentiary worth of that sale. On Mr Grennan's evidence, I have formed the opinion that even though his Sale 1 has effectively been discarded, it is indicative of a more buoyant market for in globo land as at 1992 than had previously existed. Mr Kelaher says that the expectations of the purchasers at the date of that sale have not been realised, but I would not interpret his (Mr Kelaher's) Sale 1 (Mr Grennan's Sale 2) other than reflection of a continuing buoyant market. It follows that an increase over and above the level of value which existed as at 31st March, 1989, for the subject main parcel, was not unrealistic as at 31st March, 1992, based on the sales evidence provided by Mr Grennan. A reading of my decision in the Land Court appeal against the 1989 valuation, and to which reference was made during this hearing, indicates that Mr Kelaher also accepts the existence of a higher level of value emerging during that period. He has increased his assessment of the main parcel from $30,000 per hectare in 1989 to $45,000 per hectare in 1992. The question now is whether the sales evidence or relativities provided by Mr Kelaher support his 1992 assessment. I -- 13 of 17 -- 14 am not convinced that the single sale which is common to the evidence of both valuers does support Mr Kelaher's assessment, nor am I convinced that it proves the Department's valuation wrong. It seems logical to accept Mr Grennan's view that values for in globo lands reduce in this region with distance from the Gold Coast, before the Brisbane influence emerges. Mr Kelaher's Sale 2, as I see it, has no relevance to the main parcel and Sale 3 further emphasises the location factor. Sale 4 suffers location (including proximity to quarries) and partial zoning disabilities. Sale 5, for the reasons given by Mr Kelaher, makes comparison difficult and more particularly so with regard to the main parcel. There are questions raised relative to the intensity of development potential associated with his Sale 6, but if nothing else, that sale supported the valuation which the Department had applied to the land involved. Of Mr Kelaher's relativity examples, the first and second were clearly worthy of consideration, but I am not convinced, particularly with regard to the size of the parcels involved (164.3 hectares and 373 hectares respectively) that Mr Kelaher's valuation is supported on a relativity argument. His third example, as explained by Mr Grennan, does not constitute a statutory valuation and is of no assistance. The remaining examples, as far as the main parcel is concerned, indicate to me both a pessimistic interpretation by Mr Kelaher relative to the location, potential and infrastructure available to the Dreamworld land as well as, in some cases, reliance on valuations admitted by the Department to be either wrong or in one case based on protective legislation. While the basis for the Department's valuation of the main parcel of Dreamworld as at 31st March, 1992 is not strong, due to the state of the market evidence available, I am not persuaded that it has been proved wrong. However, I cannot accept that the same evidence which is put forward to support the 1992 valuation supports the increase applied as at 30th June, 1993. Furthermore, for the reasons already given, I do not accept that the hypothetical development exercise, in the absence of sales evidence, should be adopted as the primary basis for finding an -- 14 of 17 -- 15 increase in valuation. In his hypothetical exercise Mr Grennan provided some evidence to support the increased gross realisation, based on his interpretation of individual lot sales in Helensvale. The examples he chose were unfortunate for his case, as they introduced features which were properly argued as being irrelevant to the time difference. It is true that in the lower end of the vacant land residential market, the Department, based no doubt on sales evidence overall, found an increased level of value on this type of residential land. What is not proved, at least to my satisfaction, is that any such increase in that class of developed real estate, was expressed in the in globo market for the subject land, as zoned. I do not see the hypothetical development exercises adopted by Mr Grennan as supporting his evidence that their primary purpose was to ensure proper relativity. With regard to the 1993 valuation, there is seen to be credence in the appellant's relativity argument. The Department's valuation, for example, on Mr Grennan's Sale 1, for whatever reason, has remained static in the period from 31st March, 1992 to 30th June, 1993. While Mr Grennan suggested that the 1992 valuation on the sale land is now considered to be low with the benefit of hindsight, I am not convinced that either valuation has been shown to be fundamentally wrong. I find that the submission by the Department relative to the suggested imminent improvement to services such as water and sewerage, as it might enhance the value of the subject land as at 30th June, 1993, to be better left until some certainty is demonstrated. I have decided that no increase should apply to the valuation from 31st March, 1992 to 30th June, 1993 for the main parcel of Dreamworld. Car Parking Area Mr Grennan relied on the same sales evidence for this relatively small area as for the larger parcel. His Sale 1 is in my opinion, of no assistance. Sale 2 has some comparable features while its larger area and location could be expected to influence a higher pro rata value for the smaller car parking property. In Mr Grennan's opinion the subject car park land had value greater than -- 15 of 17 -- 16 residential and was a significantly more valuable site than was the land in Sale 2. Mr Kelaher's basic evidence was referred to earlier. He does not agree that the subject land is superior to his Sale 1 (Mr Grennan's Sale 2) due to the zoning and his opinion as to the higher use potential of the sale land. His evidence overall as it relates to the car-park area is more comprehensive than that of Mr Grennan, although comparisons are difficult to make with the examples given. What he has shown is that the 1992 Department of Lands valuation on at least two highway orientated sites in close proximity to the subject land at Coomera, with physical disabilities or questionable highest and best use potential, have not been supported by sales of those sites in the period between the 1992 and 1993 valuations. Of the relativity examples provided, the "valuation" of the Reserve (1) is again of no assistance. The example in 1(A) of the Le Mans Mini Car Racing Circuit of 7.732 hectares valued at $60,000 was seen by Mr Kelaher to be of land very comparable but again his views as to relative location are not convincing. While I find Mr Kelaher's opinion as to the location of the subject car-park land to be too pessimistic, he has introduced evidence which suggests the probability of an overly optimistic approach in the Department of Lands valuation in terms of future potential relative to existing zoning. The appellant will be given the benefit of the doubt created by Mr Kelaher's evidence and opinions, and I will determine the value of the car-park land in the reduced amount of $1,100,000. Finding V94-23 - The appeal is dismissed and the valuation of the chief executive of the "main parcel" containing 73.58 hectares as at 31st March, 1992, is affirmed in the amount of Five Million Dollars ($5,000,000). AV94-79 - The appeal is allowed, the valuation of the chief executive set aside and the unimproved value of the "main parcel", as at 30th June, 1993, is determined in the amount of Five Million Dollars ($5,000,000). AV94-80 - The Appeal is allowed, the valuation of the chief executive is set -- 16 of 17 -- 17 aside and the unimproved value of the "car park" containing 10.02 hectares, as at 30th June, 1993, is determined in the amount of One Million One Hundred Thousand Dollars ($1,100,000). RE WENCK MEMBER OF THE LAND COURT -- 17 of 17 --