Planning Minister Nick Champion confirmed to InDaily this morning that Walker Corporation submitted the proposal in early February in accordance with the terms of their commercial agreement with the state government for the $1 billion Festival Plaza redevelopment.

He said Renewal SA would undertake a “formal evaluation process” of the proposal before making a recommendation to the state government.

If the tower is approved by the government, it would replace a planned three-storey retail building directly behind Parliament House, which was due to start construction this year next to the 29-storey “One Festival Tower” office building.

We’re not going to have Walker Corp or any other previous policy arrangement denying the opportunity that should exist here in the precinct

Champion told InDaily in September that the three-storey retail building had a “number of deficiencies”, including that it would separate Parliament House from Festival Plaza and obscure its views.

Heritage SA has also previously raised concern that the three-storey building could “diminish” Parliament House’s state heritage listing.

The Malinauskas Government had no power to veto the retail building as its construction was set in stone under a contract signed by the former Marshall Government and Walker Corporation in 2021.

But a clause in the contract allows Walker Corporation to request to gain access to air space above the retail building to build a second tower.

Former Treasurer Rob Lucas ruled out consideration of a second tower, but Champion told InDaily that the Malinauskas Government was open to the idea as a replacement for the three-storey building.

“Our government will consider the advice received while maintaining the right to accept or reject any proposal with absolute discretion,” Champion told InDaily this morning.

“We also recognise Walker Corporation is currently committed legally to building the three-storey development, in what would be a poor public policy outcome which fails to make the most of the iconic space.

“This is an important opportunity to get the right outcome for the Festival Plaza in the long-term while considering the surrounding Riverbank Precinct and wider community needs.”

Walker Corp’s current plans for the retail complex and office tower at the Festival Plaza. Image: Johnson Pilton Walker

Champion said to receive government support, Walker Corporation’s proposal would need to “meet these requirements, along with all relevant planning approvals, to get off the ground and maximise cultural and business opportunities for the state”.

InDaily asked Champion’s office if Walker Corporation had specified how high they wanted the proposed second tower to be, but is yet to receive a response.

Walker Corporation was also contacted for comment.

Premier Peter Malinauskas told reporters on Friday that the current plans for a three-storey retail building were a “terrible public policy outcome”.

He said the government would “drive a hard bargain” with Walker Corporation to improve the plans.

“As things currently stand, we know that Walker Corporation are committed legally to build a three-storey building that is going to block out the vista of Parliament House to Festival Plaza,” he said.

“My responsibility, Nick (Champion’s) responsibility is to make sure we get the right outcome for the Festival Plaza in the long-term.

“It is a key precinct for our state culturally and in a commerce sense too, so we’ve got to get it right.

“We’re not going to have Walker Corp or any other previous policy arrangement denying the opportunity that should exist here in the precinct.”

A Renewal SA spokesperson previously told InDaily that any additional construction works at Festival Plaza might impact access to some areas of the precinct and delay the competition of the overall redevelopment, which also includes a car park and redesigned public space and was initially slated to be complete by 2025.

They said changing the current design would require planning approval.

Walker Corporation last week announced that construction of “One Festival Tower” had reached its peak at 115 metres.

It said 90 per cent of the 29-storey office tower had been tenanted, with the first occupants to move in later this year.

Tenants include Flinders University, Mott MacDonald, VALO, Vircura and Ikara Estates.

The former Labor government gave Walker Corp exclusive rights to redevelop Festival Plaza in 2012.