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East Perth Primary School plan relies on complex deal between West Australian government and the City of Perth

The Queens Gardens car park site is the preferred site for the new school.  (Supplied: WA government)

Plans to build the first public school in Perth's CBD in more than 100 years have been unveiled, but the proposal relies on a complex deal between the state government and the City of Perth.

The City of Perth owns 2.6 hectares of land next to Queens Gardens and the WACA in East Perth, but a 1960s law means that space can only be used as a car park.

Known as the Chevron Hilton Act 1960, the law was introduced ahead of the 1962 Commonwealth Games in Perth to allow homes to be demolished to make way for a 900-bay car park.

That law remains in place 63 years later and so does the car park because the Act has legally barred the city from developing the land.

Now the state government has made a proposal to the City of Perth, offering to change the law and unlock the valuable parcel of land.

The 900-bay car park was built to accommodate spectators who descended on Perth for the 1962 Commonwealth Games. (Supplied: State Library of WA)

City of Perth yet to sign on dotted line

The government's offer rests on one important condition: that the City of Perth 'give up' a portion of the land to allow the government to build a primary school on it.

"We don't require the whole location, we require about 1.6 hectares, and there will still be about one hectare left for the city," Education Minister Tony Buti said.

"The unlocked value of this land is about $27 million, so we believe that should be attractive to the city."

Perth Lord Mayor Basil Zempilas welcomed the plan but wants to make sure the "deal stacks up". (ABC News: James Carmody)

At this stage, the City of Perth has "warmly welcomed" the proposal, but Lord Mayor Basil Zempilas has not yet committed to it.

"We are very confident, in fact I'm certain, that the vast majority of ratepayers support a primary school in East Perth, as do we," he said.

"We like what we see at the moment, but it will require a thorough process to ensure that we're getting the best deal for the City of Perth.

"Just as was the case with the WACA swimming pool, when we didn't accept the first deal that was put to us.

"My job, on behalf of the City of Perth — together with my fellow councillors and the admin — is to make sure the deal stacks up. We will do the work, we will do the necessary homework. We will conduct a thorough due diligence process to make sure that the deal does stack up."

'Endless possibilities' for leftover land

Mr Zempilas said part of the city's business case would look at what it could do with its 1 hectare of land left over after the school was built.

"There are endless possibilities really — just like would be the case with any private land owner in the city — really limited only by your imagination or perhaps proposals or ideas that were brought to you," he said.

"We could be developers ourselves. We could leave it as a car park. We could put a high-rise car park there. We could sell the land and make sure that we maximise the best use of the land."

The 1 hectare that would remain owned by the City of Perth is currently also a car park and sits to the west of the proposed school site.

The new school will service families living in Northbridge, Perth and East Perth. (Supplied: WA government)

The announcement of the proposed new school, held in the East Perth car park yesterday, was a rare state government press conference to which the Lord Mayor was invited.

Much has been written by commentators in Western Australia about the Labor state government supposedly "snubbing" Mr Zempilas and not inviting him to events in Perth.

He has also recently been touted by the struggling WA Liberal Party as someone they would like to see join their ranks.

However, Mr Zempilas and the three government ministers in attendance played down the prospect of frosty relations between the state government and the city.

West Australian ministers Rita Saffioti, John Carey and Toni Buti were all smiles as they flanked Basil Zempilas (second from right) while unveiling plans for the new school. (ABC News: James Carmody)

The Lord Mayor described Education Minister Tony Buti, Planning Minister Rita Saffioti and Housing Minister John Carey as "robust" and "willing", but said they understood what the political "space is all about".

"Their job is to advocate for the best deal on behalf of those that they represent, and I know that the people behind me understand that is also my job," he said.

"There have been issues that we have not been together on, but that is part of the space we are in.

"On this one today, right now, we are together, because delivering a primary school for East Perth is important. It's fundamental to aid the growth and for the development of this area."

Plan will help 'revitalise' city

Ms Saffioti agreed the government and the Lord Mayor were on the same page.

"We all have a similar outcome we want to pursue, and that is a revitalised City of Perth," she said.

"Of course, with all local governments, there's always going to be discussions about who pays for what and that happens with every local government, but we think it's a healthy, robust relationship."

The four-to-five-storey school would be the first of its kind in Perth and the first public school to be built in the CBD in more than 100 years.

And the state government is hopeful it will attract families to the city and ease pressure on nearby schools.

Part of the $1.4 million set aside for the site study and business case would also go towards looking at solutions to ease pressure on Highgate Primary in the meantime before the new school's planned opening in 2028.

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