The Victorian Government is set to announce the new work program for the Victorian Planning Authority (VPA) which will eventually lead to new a swathe of new #greenfield land releases.
✅This is big win, and something UDIA Victoria and developers industry has called for over an extended period.
🗺️The precursor to releasing greenfield land is a planning device known as a Precinct Structure Plan ( #PSP). Areas with the Urban Growth Zone of Melbourne, even if identified for development, cannot actually be developed without an approved PSP in place – a job the VPA is responsible for.
Over the last four years just one, solitary PSP has been finalised, with the VPA refocusing its work on activity centres around Melbourne instead. The Minister for Planning has also sat on and not approved several PSPs for an extended period.
⌛Today's announcement likely only really makes up for lost time, if that.
(Meanwhile, I can imagine the purists at the Department of Transport and Planning wincing at the idea that the politics of housing supply are overriding their utopian ideal that people should only grow "up not out" and live in medium-rise activity centres in established Melbourne.)
👍This is a very positive move, but it's too early to celebrate on the land release side. The PSP is a critical step in the journey of delivering new housing, but developers still need planning permits, infrastructure agreements (and delivery) and swathes of other approvals which mean PSPs that are approved soon will still take 3+ years from completion to get moving.
And that assumes the various external authorities are put on notice to actually deliver their end of the bargain.
💰The other sleeper issue is Development Contributions. Given yesterday's messaging about developers covering all infrastructure costs, and the (incorrect) perception that greenfields cost more than established areas to develop, expect Infrastructure Contribution Plans for these areas, plus design, density and affordable housing requirements, to be so eyewateringly high that new areas will be prevented from being feasible for a long time. Look at the recent Creamery Road ICP of $1.6m/ha for example. Watch this space.
So we now have: • Activity centre apartments (which are mostly not-feasible) • Greenfield releases (which will be made too expensive)
🤔The obvious gap that remains is unlocking larger land parcels in middle-ring suburbs for townhouse development. You know, just the most feasible, most desirable for consumers and least costly development for government.