The Wagner family, the airport and the Toowoomba neighbours’ feud
From The Australian, 11th October 2014
CURTIS Park flashes by in a blur of brick and tile bungalows in the rolling countryside outside Toowoomba. The Wagners built them all.
They own the patchwork of land beneath us, crawling with 35-tonne earthmovers and workmen in hard hats. Their field of dreams, seven minutes’ flying time from the CBD, reaches to the distant hills, a vast construction site dotted with quarries, concrete plants and a near-complete terminal for the first international-scale civil airport to be developed in Australia in almost 50 years. We swoop low over the 2.87km runway, following the approach an airliner or cargo jet would take. At the controls of the company helicopter, Neill Wagner is grinning from ear to ear. “Quite something, isn’t it?’’ he says over the hissing intercom.
A former truck driver, he is 47 and silver- haired, the third of the four brothers who run the show. The wonder is we haven’t heard more about them. In the space of a generation they have turned an investment in a rundown local pub into a construction empire that spans the globe, generating more than $400 million annually. This year’s BRW Rich Families List put their collective worth at $827 million, up $287 million in 12 months. They are pillars of the community who say grace before Sunday dinner and won’t let their kids forget the value of a dollar. “We don’t pay for mobile phones and we don’t pay for them to party,” says first son and company chairman, John Wagner.
Those who know the family can’t imagine them doing anything risky with their money. But here they are, building their own airport, on their own land, with their own workforce and without a cent borrowed from the banks or bowled up by government. John, 53, calls it a “multi-generational business”, which fits with what people are saying about how long it will take to recoup their huge investment. Aviation buff Dick Smith, who once chaired the Civil Aviation Safety Authority, can’t see how the airport will turn a profit — though he applauds the brothers’ chutzpah. “I am absolutely amazed that someone would be doing this today, because just about everyone in aviation is losing money,” says the entrepreneur.
The Wagners are as big as it gets in range-top Toowoomba, 130km west of Brisbane. Able to open just about any door, employing 700-odd locals, their company pays more in council rates than most other businesses would turn over. When the family announced in June 2012 the airport would be capable of handling most planes — up to a Boeing 747 jumbo — the response was generally positive. As the work ramped up 24/7 under floodlights, hardly a murmur of dissent was reported by the local media. The development application was deemed “code assessable” by the Toowoomba Regional Council, meaning it proceeded without an environmental-impact statement or community objections being heard. Concerns about potential aircraft noise could not be raised under the fast-track process. By the time regulators CASA and Airservices Australia got to look at the likely flight paths, it was all but a done deal. The extravagantly named Brisbane West Wellcamp Airport will open in November with QantasLink as an anchor customer.
There was just one hiccup — a very loud one, as it transpired. Sydney radio’s biggest personality, Alan Jones, went into bat for his friends, Heather Brown and David Pascoe, whose property adjoins the airport site. Most politicians tread warily around the voluble, 73-year-old broadcaster. His top-rating breakfast program is relayed to Toowoomba and the Queensland Darling Downs, his childhood home, and he has railed furiously against the expansion of coal mining and the coal-seam gas industry there. To him, this is a project too far.
Neill Wagner has a point. Up close, the airport really is something. More than 22 million tonnes of rock and gravel have been compacted into the runway, cutting diagonally across the vast site. Off it, taxiways and aprons are having finishing touches applied. The gleaming vanilla terminal has a six metre-tall glass facade leading on to 12,900 square metres of undercover space, 66 times the original envisaged size of just 195 square metres. It will boast four departure gates, two X-ray units for baggage and the capacity to handle 1.2 million passengers annually by 2018, though few except the Wagners expect the numbers to get anywhere near that. John won’t be pinned down on the cost: “Between 100 and 200,” he says casually of the millions at stake.
The rest of the family business isn’t glamorous, but it certainly pays. Wagner Investments grinds cement, hauls iron ore and has developed a process to prefabricate bridge spans from composite fibre; the Curtis Park subdivision east of the airport site is part of a meaty property portfolio. The international division, headquartered in Kuala Lumpur, helped build a nickel mine in New Caledonia and one of Russia’s biggest liquefied natural gas plants. The company grew out of a concreting operation started in 1973 by family patriarch Henry Wagner, 79, a stonemason. Money was tight with eight kids, headed by John, who attended Toowoomba’s St Mary’s College. The others went to Downlands, a pricey boarding school. For years, their mother, Mary, worked night duty as a nurse to make ends meet. When John was kicked out of university, he cheerfully went off to drive a bulldozer and started work for his father after turning 21.
In 1985, Henry sold the business, and John and his brother Denis, now 51, stayed on to work for the new owner. Three years later, the father and sons trio bought the struggling Stock Exchange Hotel in Toowoomba on a whim; they had been kicked out after complaining about the service. At the time, the pub was taking $18,000 a week. On Christmas Eve, 1989, receipts hit $100,000 for the day. This gave them the confidence to get back into concreting, John explains. He, Henry, Denis and Neill went in as equal partners in the new enterprise (Henry has since dropped out, transferring his share in the company to the youngest of the brothers, Joe, 45).
The Wagners mixed their first batch of concrete on November 10, 1989 but there was trouble from the start. The price dropped by $45 a cubic metre while the cost of aggregate base soared 77 per cent, all on the same day: they were being squeezed by their competitors. Vindication came in 1995 when the Australian Competition and Consumer Commission slapped record fines of $20 million on the companies involved in the collusion. By then, they had acquired the airport site, a 1200ha mixed grain and horse farm called Wellcamp Downs.
The land was rezoned to industrial on application by the Wagners, to the dismay of Brown and her husband, a prominent equine vet. She had a national profile as a horsewoman and former journalist of long standing with The Australian; her father, Reg Brown, owned the plucky gelding Macdougal, winner of the 1959 Melbourne Cup. They had acquired the neighbouring property, now known as Plaintree Farms, in 2001 and invested heavily in developing the thoroughbred operation. The couple say they believed the Wagners had abandoned their development plans after advertising Wellcamp for sale. As with most of this saga, the details are bitterly contested. John Wagner says a council study had identified the site as suitable for heavy industry in 1996, and the Pascoes would or should have known this; further, the plot offered for sale was farmland, beyond the rezoned area containing the airport site. In the event, Pascoe says Henry Wagner had promised him: “Our family will look after you.”
The first they heard of the airport was when it was written up in the local paper after a development application was lodged by the Wagners with the Toowoomba Regional Council on June 29, 2012. The timing is critical. Council mergers in Queensland had created a legal loophole that the family admit to exploiting. The shire of Jondaryan, covering the Wellcamp site, had been folded into the new regional council in 2008, but the pre-amalgamation planning code remained in force until the start of the 2012-13 financial year.
The Wagners beat the deadline by a day. Had they not, the development application would have been “impact assessed’’ by Toowoomba Regional Council, requiring extensive community consultation on potential aircraft noise and, most likely, an environmental-impact statement. As it was “code assessed”, third party submissions could not be considered. When the penny dropped, there was considerable disquiet. Toowoomba’s newspaper, The Chronicle, owned by regional publisher APN News & Media, may have been on board, along with mayor Paul Antonio and the Queensland government, but Brown says she tapped an undercurrent of concern. “He’s big daddy,” she says of John Wagner. “He got his way … because that’s the way it has always been.”
Wagner makes no apology. “Everything we did was strictly in accordance with the law. Strictly,” he emphasises. “Our lawyers and council’s lawyers agreed it was a properly made application and it adhered to the letter of the law.” Antonio, a former farmer, says the council obtained two sets of outside legal advice to affirm the application was in order. He acknowledges that the family took full advantage of the process, as was their right. “The Wagners certainly timed their application … If I were involved in something like this, that is precisely what I would do,” he says.
Still, it’s hard to see how a project the size of Brisbane West Wellcamp Airport could have gone through without heavier scrutiny. Witness the travails of Sydney’s second airport project at Badgerys Creek. It will have been on the books for three decades if construction starts in 2016 as planned, stalled by not-in-my-backyard protests. Brisbane Airport’s urgently needed new parallel runway will take until 2020 to complete. The Wagners’ development was approved by Toowoomba Regional Council on December 16, 2012. Construction was in full swing within four months. Asked whether the family would have proceeded if more regulatory hurdles were put in their way, John says: “We would have thought twice about it, to be honest with you.”
He insists the airport will be good for Toowoomba and, yes, for his family, too. He’s been the driving force from the start. John has loved aviation since he was a boy. His Uncle Pat, a Catholic priest, took him gliding and he was hooked. As a pilot, he holds a command instrument rating, allowing him to fly jets, propeller-driven aircraft and helicopters.
By 2012, his personal and business interests were fusing. When he did the rounds of boardrooms promoting the adjoining business park, investors pushed back. Why would they set up there? Brisbane was a two-hour drive away. Was there a train, an airline service? “No,” he said sheepishly. “You get the Greyhound bus.”
An incident at the town’s existing aerodrome, owned by the council, was telling. The largest plane it can handle is the Bombardier Dash 8 100, carrying about 30 passengers. Wagner had arranged to try out an $18 million Hawker 4000 business jet so he could fly himself to the regional office in KL. When the American pilots fired up the engines, the jet exhaust blew out the windows of shops across the road. It rammed home to him the need for a new airport. They had the land at the business park site, know-how, the equipment and expertise, and there already was a quarry at Wellcamp, one of the reasons they had bought the site in 1994 for $3 million. Most of all, the company had cash on hand. “You can’t borrow for an airport without a customer … the banks would say you’re crazy,” he says. That’s partly why there hasn’t been a major public airport built since Tullamarine opened in Melbourne in 1970. But this felt right. “Right for the region, right for us and certainly the right thing for Toowoomba,” he says. “The fact is, we can build the airport faster and cheaper than anyone else could.”
The milestones have rolled by thick and fast. On July 23, John Wagner landed his Beechcraft King Air twin turboprop on the newly surfaced runway, the first plane to touch down. On September 2, Premier Campbell Newman was on hand for the announcement that QantasLink, the carrier’s regional arm, would operate 11 return flights a week to Sydney from Wellcamp, gainsaying Jones, who predicted it would never attract an airline. Work is progressing at a furious pace; the QantasLink services are set to start on November 17.
A number of regulatory issues remain. While the Wagners were able to sidestep an EIS and noise studies to build the airport, it’s a different matter to operate it, which they intend to do. CASA must certify the facility and has confirmed there will be no curfew: flights can come and go round the clock. The agency says the approvals are expected by the end of this month “subject to the aerodrome meeting all of CASA’s requirements”. The federal Environment Department is assessing noise maps forwarded by the Wagners’ consultants, and John says he is not aware of any issues. Airservices Australia — the provider of air traffic control — has plugged the new airport into a pre-existing review of airspace in the Brisbane basin, taking in the busy military air base at nearby Oakey on the Darling Downs, the army’s principal training centre for helicopter pilots. The military top brass were deeply unimpressed to lose what turned out to be 30 per cent of the designated airspace. Air Commodore Anker Brodersen, then responsible for the strategic management of defence installations, had warned Toowoomba Regional Council in 2012 that the airport had “safety implications’’ for Oakey and should be further away from the air base.
Alan Jones said the likely disruption to military operations was compounded by how the Wagners were to be gifted restricted airspace, a valuable public asset. He contacted Tony Abbott, then Opposition leader, who seemed receptive. Abbott told Jones on July 18 last year that Oakey was “sacrosanct’’, according to the broadcaster’s files. Six days later, he wrote that he was “mystified as to how a new airport in a closely settled part of the country could be approved with no consultation and apparently a big and uncompensated loss for neighbouring landholders. It would certainly seem to need reconsideration.”
Approached by this magazine, the Prime Minister’s office said there were “still several regulatory approvals that need to be completed before passenger services commence”. Defence said in a statement it was now satisfied with the airspace arrangements, but noted, intriguingly, this “may change again in the future to accord with … changes in civil and military flying in the region”. There would be no detrimental effect on operations at Oakey, it insisted.
The Wagners say the airport will be mainly a passenger operation, a hub for the 344,000 people living in its catchment area on and to the west of the Great Divide. They’re also hoping to siphon business off Brisbane’s congested main airport. The company has joined a consortium bidding for the $1.7 billion second Toowoomba Range crossing that will run past the Wellcamp site, servicing both the airport and the industrial park, still a work in progress. John Wagner argues the new road will cut the travel time from Brisbane’s growing western suburbs to 50 minutes, and parking will be cheaper. (Brisbane Airport points into Moreton Bay, on the opposite side of the city, but is serviced by a state-of-the-art car tunnel and elevated train.)
The Wagners’ business model forecasts 401,921 passengers in the first year of operation, the majority of them local, rising to 1.364 million in year five. By then, projected outputs would have grown from $161.6 million for 2015 to $595.8 million to deliver a return on the family’s investment. More than 3200 jobs would be created in the first 12 months, a quarter of them in Toowoomba. Premier Newman says: “This will make a huge difference to the city. It will mean that people will be able to travel here for tourism, it will mean that the gas and energy sector will be able to be well-served … also we see great opportunities for air freight.”
Yet Dick Smith is not the only aviation figure to doubt the new airport’s earning capacity. Former Qantas chief economist Tony Webber can’t see how the numbers stack up on the passenger side. “The outbound traffic is too small, there is not much inbound to a place like Toowoomba and you might get a bit of fly-in, fly-out to the mines in central Queensland, but it won’t be enough in my view,” he says.
Wagner is adamant the project will fly. For a start, he wants to change how air freight is done. Wellcamp will have none of the capacity constraints that limit operations in Melbourne, Brisbane and Sydney airports, the latter with a curfew. He points to the air trade in live goats to the Middle East. “They take the goats from Charleville, west of here, and truck them right past our door to put them on a jumbo out of Sydney every Sunday. How crazy is that?” Fresh milk and dairy exports into China are another lucrative market, Wagner believes. “We can put produce on a plane here and have it to the market just about anywhere in Asia next morning.”
The Pascoes, the Wagners and Alan Jones have shared history on the Darling Downs, which has some of Australia’s best agricultural country overlaying rich coal and coal-seam gas reserves. Like the Wagners, Pascoe’s ties to the area reach back five generations. Brown grew up on a property outside dusty Cloncurry in northwest Queensland, and as a journalist she specialised in writing about the bush. She is well connected politically and in the media; Jones is a friend of more than 30 years’ standing.
He was raised on a farm near Acland, 35km northwest of Toowoomba, and still calls it home. Today, it’s a ghost town, set to be engulfed by a vast open-cut coal pit. Mining and coal-seam gas development have “vandalised and desecrated” the countryside, he says. As Jones tells it, the story is of the battlers being sold out. He professes not to know the Wagners (though he and Denis once met at the Toowoomba home of Jones’s sister, Colleen), and has no interest in the family’s humble beginnings or success. “I know their behaviour,” he says. “I am simply saying you don’t run roughshod over people to make a quid, and they have run roughshod over that community.”
Brown says she and her husband are not opposed to “the principle’’ of an airport. “It’s about how it was done, how we have been treated,” she says. Their home in Toowoomba — they don’t live on Plaintree Farms — was burgled on September 17 last year, while they were at work. Brown says she was targeted over her activism; her laptop and iPad were taken for what was on them, she says, and she believes the intruders went through her files in the office she shares with her husband, leaving his belongings untouched. She went on Jones’s program the following Monday to voice her suspicion it was no ordinary break-in. The 2GB shock jock introduced her as the “victim of bullies wanting her to shut up”. However, she made no specific allegation about who might be behind the robbery: she had “no proof … but what I would suggest is that this is a mixture of politicians, of mining companies and development interests in the community”.
The couple’s relationship with John Wagner turned to poison. Heated exchanges between the developer and Pascoe ensued over noise from the construction site; their front paddocks are only a few hundred metres from the end of the runway and he was worried about their horses. Wagner approached Brown at a dinner at Toowoomba Turf Club on November 12, 2013, and true to form their accounts of the conversation differ. She says he assured her he had nothing to do with the break-in; he counters he merely expressed disappointment that Jones had tried to “implicate” the family. Two weeks later, there was further contact. A big crowd had turned out for an open day at the airport site, featuring displays by low-flying “warbird’’ stunt planes. When Brown got hold of Wagner that night on the phone, she told him the din was unacceptable: they had mares in foal that were traumatised. According to her, he replied: “Obviously, our businesses are incompatible and you need to relocate.”
John Wagner, Brown and Pascoe finally met at Plaintree Farms on March 24 this year, ostensibly to thrash out a deal. But another problem had erupted. Brown had been nosing around the connection between the Wagner quarry near the Lockyer Valley town of Grantham and the January 10, 2011 flash flood that killed 12 people there. An earthen embankment between the quarry pit and a raging Lockyer Creek gave way, and some locals were convinced this had funnelled the lethal torrent into the town. Alan Jones agreed: “The wall collapsed, the tsunami took over. What else can you say? That happened. The people are dead and the families of Grantham have no answers.”
A commission of inquiry into the floods disaster found the quarry pit had, in fact, delayed the wall of water by five minutes and reduced its height in Grantham by up to 10cm. Lockyer Valley mayor Steve Jones says, however, many questions about the water flows on that horror-filled day remain unanswered, and there should be another inquiry — a proposition rejected by Premier Newman.
Brown insists her investigation into the tragedy was about justice for the victims, not the dispute with the Wagners. John Wagner sees it differently. “I think that she thought that … by causing enough public grief we would offer a big rainbow cheque, but it worked the opposite way … We had a fair bit of a blue,” he says of the March 24 meeting. “I haven’t heard from her since.” Brown denies any ulterior motive. “I just considered it was the right thing to do,” she says, her voice thick with emotion. “The value of this farm and where we would find ourselves never crossed my mind, and that’s the truth.”
The couple were away for Easter, visiting Jones and other friends in Sydney, when thieves hit their home again on Sunday, April 27. This time they went for Pascoe’s property, including his Toyota LandCruiser. There was a further break-in the following night, and on the next day private security staff stopped yet another intrusion, according to the couple. Brown says she told the police they were being “intimidated”, and she was afraid. But she did not name anyone to the police. “What’s the point,” she says.
In a statement to this magazine, Queensland Police Service said two men and a 24-year-old Toowoomba woman had since been charged over the April 27 burglary, but there was no evidence to connect this incident to the subsequent incidents at the house over Easter or to the initial break-in of September last year. While the investigation was continuing, there was nothing to suggest the “offences are related in any way to the Wellcamp airport development”, the QPS said.
Brown hopes to tell her story to the Senate inquiry into the Queensland Government, instigated by Clive Palmer’s crossbenchers, where “the truth will come out”. Meantime, she feels like a “refugee” in her home: trapped, unable to move on while the bitter dispute with the Wagners drags on. “Would I do it all over again?” she asks rhetorically. “No, I wouldn’t. I would get out as fast as I could … I wish I had never heard of this place.”
It’s a tangled web and it keeps growing, drawing in people who want no part of it. Earlier this year, John Wagner confronted the wealthy retail and horse racing entrepreneur Gerry Harvey over rumours he was “bankrolling” the campaign against the airport. Brown is a friend (“I’ve known Heather forever,” Harvey says) and some of his thoroughbreds go to Plaintree Farms for spelling. Wagner Investments is also a big customer of Harvey Norman. Over lunch in his Sydney boardroom, Harvey assured Wagner that he was not involved. “I’m the meat in the sandwich and I don’t see any point in my putting myself in that position,” he says.
Dick Smith was pressed by Jones to come out against the airport, which he refused to do. “I said, ‘Look, Alan, I am positive about all aviation so there is no way I would want to criticise the airport’,” he recalls. “There really wasn’t much more of a discussion when he realised I was so definitely pro-aviation.”
If the intention was to turn public opinion in Toowoomba, it doesn’t seem to have worked. The Wagners have hit back, hard, to defend their reputation. The company’s community and tourism development manager, Sara Hales, has doorknocked every house within a 5km radius of the site and spoken to about 400 people to date. She takes along an electronic noise monitor to give them an idea of what they’re in for. At close hand, conversation registers in the 50-60 decibel range — according to Hales, the maximum level of noise the neighbours would hear from aircraft coming and going. Those who want out have been made offers by the company — with the exception of Brown and Pascoe. One of the sellers, Les Smith, 64, who also breeds horses across the road from the airport, is delighted with his deal and will stay on the farm, having leased the land back from the Wagners. “Nothing but gentlemen,” he says of them.
Mark Williams, 52, and his wife, Janice, 50, say John Wagner told them he was willing to buy their 200ha mixed cattle and cereal farm. “There was no offer, he just said if there was a point that we wanted to, we should talk,” Mark says. Pascoe and Brown don’t speak for them, he maintains, and nor does Alan Jones: “I can’t understand why he is so negative about the airport because if anyone was going to have a problem, it would be us.” Two other affected landholders would not be quoted. Neither criticised the Wagners.
John Wagner says there’s no mystery, no hidden agenda to what they’re doing at Wellcamp. They decided to build an airport, so they did, because they could and it made perfect sense to them, just as the cement works they constructed from scratch in Brisbane delivered value only they could see. “Everyone said we were crazy to do that, they said we didn’t know what we were doing, we were dickheads,” he says, his eyes steely. “And you know what, we’ve just tripled the capacity of the plant.” The expansion cost $45 million. When your pockets are that deep, the sky is the limit.