Community Use Policy

A policy which gives local councils, Local Aboriginal Land Councils and community groups the opportunity to buy eligible surplus NSW Government-owned property to deliver community benefits.

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The NSW Government’s $230 billion property portfolio (as at 30 June 2024) is used to deliver critical government services and infrastructure, including transport, schools and medical facilities, throughout the state.

Under the Community Use Policy, certain properties no longer required for current or future government service delivery may be offered to local councils for purchase to deliver better community outcomes.

This ensures local councils are given an opportunity to purchase properties that have been declared surplus by the Government, subject to satisfying specific criteria, at either a discounted price if the property will be put to community use for 15 years, or at full market value.

The policy also allows Local Aboriginal Land Councils and local community groups (as listed in the Australian Charities and Not-for-profits Commission Charity Register) an opportunity to purchase surplus properties at a discount to market value with a 15-year community use restriction on the title.

Frequently asked questions

Which government agencies and properties are subject to the policy?

The Community Use Policy applies to all General Government Sector agencies and Public Non-Financial Corporations (excluding State Owned Corporations). Property held under the National Parks and Wildlife Act 1974 is excluded.

Crown land that is not deemed to be of state significance will continue to be made available for transfer to local councils under the Crown Land Management Act 2016.

The policy does not apply to land acquired by statutory authorities, including the Office of Strategic Lands, for the purpose of transfer to local councils.

Which properties can be transferred to local councils, land councils and local community groups under the policy?

Properties declared surplus by both the landowning agency and other government agencies, and are unsuitable for housing, will be offered to the relevant local council to purchase where the unconstrained market value is:

less than $2 million if the property is in the Lower Hunter and Greater Newcastle City, Central Coast City, Illawarra-Shoalhaven City, Western Parkland City, Central River City or the Eastern Harbour City areas.
less than $1 million if the property is located elsewhere in NSW.

The property must also be vacant, not required to meet government asset sales targets, and meet at least one of the following criteria:

The current zoning is Public and Private Recreation (RE1, RE2), Infrastructure (SP2), Special Activities (SP1), Environmental Conservation / Management (E2, E3) or similar.
There is potential to create quality green and public space.
The use of the property is constrained to the existing use (for example, a hall, place of worship, community facility).

What are the property transfer conditions under the policy?

Local Councils

At the discretion of the selling agency, eligible properties will be offered for sale to local councils at either:

a discounted market value price with a 15-year restriction on the title that the property will be used for community purposes only, or
at full market value with no community-use restriction on the title.

A ‘community use’ relates to the dominant use of the property. Ancillary commercial uses that generate revenue primarily to be used for maintenance and capital investment in the property (for example, a small kiosk or café) are permissible as long as the dominant use is for community purposes.

If the selling agency decides to sell the property at full market value, then only the local council is eligible to purchase that asset under the policy.

Local Aboriginal Land Councils and community groups

Should the selling agency decide to sell the property at a discounted market value price with a 15-year community use restriction, and the local council chooses not to acquire the asset, it will be offered to the Local Aboriginal Land Council under the same terms and community use conditions.

If the land council also chooses not to purchase the property, it may then be offered to a local community group to purchase it for community and non-profit making purposes. The local council may nominate a community group, but this is not required.

Eligible local community groups are those listed in the Australian Charities and Not-for-Profits Commission Charity Register.

Community use breaches

If, during the 15-year restriction period, the property is not used primarily for a community use, or the relevant entity ceases operations, the Government has the right to reacquire the property at the price originally paid, less any additional liabilities incurred such as damage and contamination.