Adjustments to Melbourne CBD planning controls to promote commercial office developments could support more than 9,500 Victorian construction jobs, according to new analysis produced by the Property Council of Australia (PCA).
At a recent PCA luncheon, Premier of Victoria, the Hon. Daniel Andrews MP, confirmed that changes to C270 planning controls can be expected before the end of the year.
Changes to the C270 planning controls were introduced in 2016. These changes saw the addition of mandatory requirements in relation to building setbacks and restrictions relating to plot ratios and shadow controls.
Since the introduction of these controls, new approvals of commercial developments in the CBD have plummeted, leading to concerns about the pipeline of supply beyond the current cycle and the impact this will have on construction jobs.
According to PCA Executive Director for Victoria, Cressida Wall, since C270’s introduction, commercial CBD approvals have fallen dramatically and future supply has dried up, while vacancy rates are at historic lows.
“This position is untenable and changes to C270 to support commercial development are the release valve Melbourne urgently needs,” she said.
“Despite the additional office space that works currently underway will bring into the market, there is a real concern future needs will not be able to be met without changes to C270.”
According to an Urbis report (which was commissioned by the PCA in late 2018), at least 10 iconic Melbourne buildings that have either been built or that are currently under construction could not have been approved under the existing C270 controls.
PCA modelling indicates that, if this were the case, an astonishing 14,000 jobs would never have existed.
On Thursday 1 August 2019, the PCA released a brand new Office Market Report.
The report highlights that once the current supply pipeline of office construction wraps up there are no new scheduled projects to support the ongoing CBD development.
Assuming the current pipeline of commercial office buildings in Melbourne’s CBD cannot be replaced with future projects because of C270 constraints, PCA modelling predicts that over 9,500 jobs will be at risk.
“We applaud the Government’s announcement that changes to the planning controls will be announced before the end of the year, however, we remain hesitant until it is clear that changes will allow for the development required to meet Melbourne’s growing office demand,” concluded Ms Wall.