Property Victoria Magazine - November/December 2013

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NOVEMBER/DECEMBER 2013

PROPERTY V I C T O R I A

Fast Lane to Growth The Hon. Dr Denis Napthine MLA Premier of Victoria

LOBBY LOWDOWN

SPRING STREET SWEEP

INDUSTRY INSIGHTS

MEDIA HEADLINES

Here’s an exciting development.

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Inside this Issue

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Inside this Issue Lobby Lowdown

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Property’s Voice

Spring Street Sweep

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Jennifer Cunich Executive Director, Victoria Division

Industry Insights

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Fast Lane to Growth

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The Hon. Dr Denis Napthine MLA

Media Headlines Advocacy Update Property Podium

Acting on a Grand Vision

East West Link will boost productivity and connectivity across our city and state Premier of Victoria

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Spotlight on Tasmania

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Events

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Events Calendar

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Partners of the Month

What’s next for Victoria’s long awaited planning strategy?

Roz Hansen

Planning Committee Chair, Victoria Division Malcolm Snow General Manager, Environment & Planning, City of Port Phillip

Level 7, 136 Exhibition Street Melbourne Victoria 3000 Phone: 03 9650 8300 Fax: 03 9650 8693 Email: vic@propertyoz.com.au Website: www.propertyoz.com.au EDITOR Sandra Qian Phone: 03 9650 8300 Email: sqian@propertyoz.com.au Property Victoria is published bi-monthly.

The Publisher reserves the right to alter or omit any article or advertisement submitted and requires indemnity from the advertisers and contributors against damages or liabilities that may arise from material published.

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Jennifer Cunich

Executive Director, Victoria Division

From Farms to Families and Factories: Fifty Years of Growth in Knox Peter Chaffey

Economic Development Coordinator, Knox City Council

October

November

twitter.com/propertyozvic Property Council of Australia (Victoria Division)

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Plan Melbourne: A New Era for Melbourne’s Growth

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Mentor Program 2013

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December

www.propertyoz.com.au DESIGN Blick Creative 1st Floor/382 Queens Pde Clifton Hill VIC 3068 www.blickcreative.com.au DISPLAY AND CLASSIFIED ADVERTISING Sandra Qian Property Council of Australia (Victoria Division) Level 7, 136 Exhibition Street Melbourne VIC 3000 Phone: 03 9650 8300 Fax: 03 9650 8693 Email: sqian@propertyoz.com.au

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PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

MAJOR PARTNERS

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Property’s Voice

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

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Property’s Voice Acting on a Grand Vision Jennifer Cunich

Executive Director, Victoria Division

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n a very welcome end to the year, the Victorian Government has delivered its draft strategy for metropolitan planning.

Presented as the blueprint for the city’s growth, the plan seeks to retain the qualities that have made Melbourne the most liveable city in the world.

The final strategy promises to be the biggest planning change in recent decades and should be commended for the extent of its engagement and consultation.

Packed full of policy recommendations to address key development challenges, it is a welcome decision with respect to creating a vision for Melbourne’s future. However, as we have learnt from Melbourne 2030 and Melbourne @ 5 million, great visions need to be underpinned by mechanisms that move decisively on their implementation.

The creation of a Metropolitan Planning Authority (MPA) is arguably the most important initiative in the strategy.

With a metropolitan-wide mandate, the MPA is in an ideal position to deliver

strategic planning policy in the best interests of the whole of Melbourne. This governance approach is crucial in areas such as delivering jobs growth, transport connectivity and services provision. It is also important for urban area residential development where decisions should be made with respect to the overall shape of the city.

The Property Council has long called for a depoliticised planning authority to oversee city-wide development and welcomes the potential for serious planning reform posed by the MPA. The challenge now for industry is to ensure that the MPA is given the power to become a genuine decision making body.

Through the MPA, the Government will have many opportunities to work closely with the private sector on the plan implementation. On this front, the MPA should reflect an understanding of the commercial realities faced by the property sector in order to develop frameworks that are capable of sharing risk and delivering

attractive benefits to all participants.

As ever, Victoria’s business community is eager to invest in urban renewal and major projects that will transform our city, improve housing affordability and improve our quality of life.

Victoria is in need of a planning system that provides the property industry and community with certainty, facilitates business activity and grows the state’s potential. The MPA promises to put Victoria on the front foot for achieving these objectives. In the coming months we will see where it is given the powers necessary to accomplish them.

Jennifer Cunich Executive Director, Victoria Division Property Council of Australia

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Lobby Lowdown

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Lobby Lowdown Property Council forms East West Link Alliance

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he Property Council and nine of Victoria’s largest industry and membership organisations have thrown their support behind the East West Link, the road infrastructure project which will connect the Eastern Freeway to the Western Ring Road.

The East West Link Alliance’s nine other members include the Australian Logistics Council, the Australian Industry Group, Infrastructure Partnerships Australia, the Master Builders Association of Victoria, the Royal Automobile Club of Australia, the Victorian Automobile Chamber of Commerce, the Victorian Employers’ Chamber of Commerce and Industry, the Urban Development Institute of Victoria and the Victorian Transport Association.

Representing over 2 million members and thousands of businesses, the East West Link Alliance joined the Premier recently to mark the beginning of Freight Week.

Once completed the East West Link is expected to improve the current capacity for cross city connections in Melbourne

by providing an alternative route to the existing M1. Given that around 200,000 vehicles cross the north of Melbourne’s Central Business District every day, the East West Link promises to alleviate serious congestion by helping improve Melbourne’s connectivity in a critical bottleneck.

Fire Services Property Levy implementation for retirement villages

Last year, the Property Council identified a shortlist of infrastructure projects that should be prioritised based on their productivity and the economic dividends, in its report ‘Securing Victoria’s Future – A Program to Plan, Fund and Deliver Infrastructure’. The East West Link was included on this list for its ability to deliver numerous short, medium and long-term benefits for Victorians. Over the next forty years, Victoria’s freight will triple and its containerised trade will quadruple. The only way Victoria will be able to manage this logistical challenge is if a pipeline of major projects such as East West Link, Metro Rail and the North East Link are delivered.

Under the new property-based levy, retirement villages should be charged under the residential classification. It was recently brought to the Property Council’s attention that several retirement villages in Victoria had been classed under commercial property for the FSPL. Following consultation with the Treasurer’s Office, the Property Council has confirmed this is incorrect.

The Property Council has given its support to the East West Link as we recognise the project’s critical importance for Victoria’s economy and liveability.

From 1 July 2013, the Fire Services Property Levy (FSPL) means local councils are responsible for collecting the propertybased levy directly from all property owners.

Landlords of retirement villages are reminded to check their Fire Services Property Levy charges to ensure they are being implemented correctly. Those which are being levied the commercial rate should approach their council and the State Revenue Office to seek a correction.

20 Projects: Victoria’s Best Investment Sites The Property Council has called for the activation of $4.6 billion worth of publicly owned sites to stimulate investment, create jobs and boost infrastructure revenue.

In its latest research report, 20 Projects: Victoria’s Best Investment Sites, the Property Council has identified 20 federal, state and local government property assets which could be sold to the private sector to raise revenue. In each case, the market investment opportunities are clearly outlined as are their potential flow on benefits.

The Property Council believes the revenue raised from their sales could be used to upgrade local amenity and importantly, address Victoria’s infrastructure deficit.

In a period of sub trend economic growth, Victoria’s economy needs projects that will drive activity, create jobs and stimulate investment. Our latest report offers a pathway to unlocking unrealised capital without a significant cost to government.

Consequently, we are calling on each level of government to release under-utilised and surplus land and allow the private sector to do what it does best – invest, employ and growth the economy.

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Spring Street Sweep

Spring Street Sweep

Budget surplus reaffirms call for tax reform

Energy Efficiency Office Buildings Program

he Victorian Government has recorded a $316 million surplus for the 2012-2013 financial year.

Commercial property owners will be able to improve the efficiency of Victorian office buildings with the introduction of the $3.6 million Smarter Resources Smarter Business - Energy Efficient Office Buildings program.

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The surplus was significantly higher than the $177 million estimate given at the time of the state budget and will allow the Victorian Government to moderate its debt and borrow at cheaper rates.

The Property Council welcomes the budget surplus and believes it provides the Government an opportunity to ease its tax burden on the property sector.

At present, Victoria’s property sector is responsible for generating 39.5 per cent of total state revenue annually. This burden undermines the sector’s overall profitability and disregards its ongoing economic contribution to the state.

Long championed by the Property Council, the program provides matched grant funding (of between $20,000 to $150,000) to owners of mid-tier commercial office buildings investing in energy efficiency upgrades.

The built environment can yield some of the most cost effective energy efficiency savings of greenhouse gas emissions.

While new buildings form an important part of the energy solution, existing buildings which have comparatively lower energy ratings comprise around 97 per cent of building stock. On this

front, programs which reduce market barriers to energy efficient activity can lift tenant appeal, boost asset value and make businesses more competitive.

The Property Council believes that energy efficiency activities should be the first consideration in the suite of emissions abatement strategies to ensure that subsequent emission reduction activities can maximise their full potential.

The Energy Efficient Office Buildings program aims to lower operational costs and raise productivity whilst helping the environment. It is expected to save businesses around $9 million while reducing greenhouse gas emissions by more than 140,000 tonnes over ten years. Commercial property owners are encouraged to take part in this program and can find out more at Sustainability Victoria’s website, www.sustainability.vic.gov.au

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Industry Insights

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Industry Insights New Members VICTORIA DIVISION

MEMBER TYPE

REPRESENTATIVE

Matisse Communications

Associate

Mr Michael Flynn

Landair Surveys

Associate

Mr Erik Birzulis

Buildcorp Interiors Vic

Associate

Mr Jason Wilcox

Mills Oakley Lawyers

Associate

Mr Tom Cantwell

Tonkin & Taylor Pty Ltd

Associate

Mr Tim Chadwick

McGregor Coxall

Associate

Mr Justin Ray

UCI Pty Ltd

Associate

Mr Mike Radda

Noordenne Family Group

Core

Ms Melanie Pateras

Berton Investments Pty Limited

Core

Mr Nick Bernardo

Tigcorp Pty Ltd

Core

Ms Leanne Avery

Able Australia

Core

Mr James Xu

TASMANIA DIVISION

MEMBER TYPE

REPRESENTATIVE

Integrated Facility Solutions Pty Ltd

AM

Mr Shiromon De Silva

Members Update

Peter Armstrong

Acting Chief Executive Officer of Places Victoria

New acting CEO of Places Victoria Peter Armstrong has been appointed Acting Chief Executive Officer of Places Victoria in addition to his role as General Manager – Major Projects. Peter has extensive senior management experience and a successful track record in the property and construction, leisure and hospitality, retail, food and manufactured consumer goods, general merchandise and apparel sectors. Prior to joining Places Victoria in November 2012, Peter was the CEO and Managing Director of Redcape Property Fund. He will continue to lead Places Victoria until a permanent CEO appointment is made.

Metropolitan Planning Authority replaces Growth Areas Authority

Irwinconsult opens new office in Bendigo

With the announcement of the draft Metropolitan Planning Strategy, Plan Melbourne, the Planning Minister has announced that the Growth Areas Authority will become the Metropolitan Planning Authority (MPA).

Irwinconsult has opened an office in Bendigo. The company will work in association with the local structural practice Osborne Consulting Group to deliver consulting engineering services for the regions to the North and West of Melbourne.

Headed by Peter Seamer, the MPA will be a key authority in charge of implementing the initiatives outlined in Plan Melbourne. Mr Seamer has a background encompassing both government and private enterprise roles including the CEO of Federation Square and CEO of Places Victoria.

Tom Cantwell and Pablo Fernandez join Mills Oakley Lawyers Mills Oakley Lawyers has appointed a new partner, Tom Cantwell to its Melbourne office as a member of its property team.

Mr Cantwell previously headed DLA Piper’s Melbourne Real Estate team. He has more than twenty years’ experience on complex and high value, property based transactions. Mr Cantwell is also Chairman of the Property Council’s Victorian Tax Reform Committee.

Mr Cantwell is joined by special counsel Pablo Fernandez in the move to Mills Oakley Lawyers.

Sheree Proposch joins HASSELL Sheree Proposch has joined the international design practice HASSELL as Principal. Ms Proposch who has a 25 year career working in Australia, Singapore and the United Kingdom is part of the HASSELL health team. A recognised leader in hospital design, Ms Proposch has developed a portfolio of successful projects including the design and delivery of the Royal Children’s Hospital while at the Australian based practice Bates Smart.

Federation Square appoints CEO Chris Brooks has been appointed to Chief Executive Officer of Federation Square, commencing in early January. Mr Brooks’ experience includes senior executive roles in public and private sectors in government, finance, infrastructure and resources. Recently, he has been working on resource projects within the Department of State Development, Business and Innovation.

Media Headlines

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Media Headlines High powered support for Melbourne’s proposed East West Link

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he East West Link has received the support of a coalition of highpowered motoring and business group, according to an article in The Herald Sun published on 2 September.

Nine industry organisations, including the Property Council of Australia, the RACV and Master Builders Association joined the Premier Denis Napthine at the start of Freight Week to voice their support for the EastWest Link.

Premier Napthine said the infrastructure project was critical to alleviating Victoria’s congestion problems. He added that the project will improve the quality of life of those who have been affected by increased traffic in the inner suburbs.

The Victorian Government has expressed wishes for the $6 - $8 billion project to began construction before next year’s state election.

Melbourne’s growth plan gets thumbs up

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n 10 October, The Australian Financial Review reported that Melbourne’s latest planning blueprint,

Plan Melbourne, had been praised for its efforts to link population increases with jobs growth.

Peter Seamer will be leading the new agency, which replaces the existing Growth Areas Authority.

Executive Director of the Property Council of Australia’s Victoria Division, Jennifer Cunich, welcomed the document’s mission and said that the key will be the pipeline of infrastructure.

Asher Judah, Deputy Executive Director of the Property Council of Australia’s said the new plan needed to include “clear

“If you don’t have the infrastructure, all the wishing and wanting in the world is not going to get people there,” she said.

Mr Judah said the Metropolitan Planning Authority needed to have real teeth, adding this was necessary for Melbourne to become a global city.

Referring to the Plan Melbourne strategy, Ms Cunich also noted that residential no-go zones (which could be nominated by local councils to curb development) were a serious concern that could obstruct the sharing of growth across suburbs.

Victoria ups urban strategy to absorb 2m people

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new statutory body, the Metropolitan Planning Authority, will steer the city’s absorption of more than two million people over the next four decades.

In an article published in The Australian Financial Review on 9 October, the Planning Minister Matthew Guy described the new statutory authority as a “powerful body” which will be responsible for delivering “the largest urban renewal pipeline in Victoria’s history”, including up to 600,000 new dwellings.

and fair guidelines” on the infrastructure contributions levied on developers.

The new planning blueprint seeks to drive growth into urban renewal zones and spread the state’s population growth into regional hubs and ‘peri-urban’ towns located between 50 to 100 kilometres from the city. There would also be increased development in Melbourne’s greenfield areas. Planning Minister Matthew Guy has confirmed there will be no changes to Melbourne’s urban growth boundary.

The Property Council has also called for targets and incentives for local councils to meet density requirements in their suburbs.

Napthine plans for population boom with more Melbourne homes

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ccording to an article published in The Australian on 10 October, inner Melbourne will have higher-density housing and at least one million dwellings built in the metropolitan area under the new Victorian Government’s metropolitan planning strategy, Plan Melbourne.

The blueprint protects half of the city’s residential zoned land from high rise development and calls for a permanent metropolitan urban boundary.

The Property Council of Australia believes a firm urban growth boundary will inflate house prices.

The planning document indicated that the Victorian Government plans to accommodate future growth through a focus on medium and high density development in existing urban area.

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Fast Lane to Growth

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Fast Lane to Growth

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Fast Lane to Growth East West Link will boost productivity and connectivity across our city and state

The Hon. Dr Denis Napthine MLA

Premier of Victoria

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he Victorian Government has allocated construction funding for East West Link Stage 1, which will complete a missing link in Melbourne’s road network. By reducing congestion on our roads and cutting travel times, East West Link will boost Victoria’s productivity.

As well as the $6-8 billion East West Link, the Victorian Coalition Government is also committed to: • the $4.8 billion Regional Rail Project which is under construction;

In providing a connection between the Eastern Freeway and the Tullamarine Freeway/CityLink, the East West Link will bring long awaited and much needed relief for motorists who are fed up with traffic gridlock in Melbourne.

The East West Link tunnel will save motorists travelling across Melbourne around 20 minutes on an average trip during peak hours and enable people to avoid up to 23 traffic lights.

• the Melbourne Metro rail tunnel; and, • the Port of Hastings.

Investment in these strategic projects will enhance the productivity, liveability and competitiveness of Victoria.

They will follow in the tradition of visionary projects such as the City Loop, West Gate Bridge and City Link.

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This game-changing project will open up fantastic urban renewal opportunities to boost liveability in the inner city, particularly Collingwood, Fitzroy and Carlton North. The amenity of these areas will be transformed by removing traffic from the dead end of the Eastern Freeway.

In addition, north-south public transport and cycling connections will be able to operate much more smoothly.

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The project has been welcomed by business groups and numerous unions.

I acknowledge the leadership shown by the Property Council of Australia in advocating for the project. These groups recognise the importance of the East West Link in building our economy, creating more than 3,200 jobs, and removing congestion across our road network.

Victoria’s Coalition Government is building the infrastructure we will need tomorrow, whilst at the same time driving growth in Victorian businesses and securing jobs here and now.

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The tender process for East West Link is underway – the Government recently shortlisted three consortia to deliver the project. All of the consortia have strong financial backing and deep expertise in engineering and construction. It is anticipated that the construction of the project will begin in 2014.

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Plan Melbourne: A New Era for Melbourne’s Growth

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Plan Melbourne: A New Era for Melbourne’s Growth

Plan Melbourne: A New Era for Melbourne’s Growth

Roz Hansen

Malcolm Snow

Planning Committee Chairman, Victoria Division

General Manager, Environment & Planning, City of Port Phillip

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Jennifer Cunich

Executive Director, Victoria Division

What’s next for Victoria’s long awaited planning strategy?

Professor Roz Hansen, Planning Committee Chairman, Property Council of Australia (Victoria Division)

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s stated by the Premier Dr Denis Napthine at the recent launch of the Victorian Government’s draft Metropolitan Planning Strategy, ‘Growth is good’. Indeed, with the right management and infrastructure provision, growth can be very beneficial .

Whilst a new Metropolitan Planning Authority can facilitate the delivery of the new strategy, the issue of how we pay for the much needed urban infrastructure remains largely unresolved.

Development contributions alone will not fully cover the cost of new schools, new hospitals and improved public transport services in the growth area communities and established urban areas earmarked for more growth. Better use of existing infrastructure makes sense. But where there is currently a demonstrated lack of adequate hard and soft infrastructure, much of the development has already occurred – how will we address these shortfalls?

ensure that what we want to achieve over the forthcoming decades can and will be delivered and paid for in a fair, equitable and timely manner.

Malcolm Snow, General Manager, Environment & Planning, City of Port Phillip

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lan Melbourne presents a holistic view of planning policy that seeks to develop and enhance our city’s muchtouted liveability.

Whether its somewhat cautious, evolutionary approach can address the challenges facing our city will be the ultimate test of its merit.

The Plan calls for leadership in placemaking, recognising the pivotal role of local government in pursuing this aspiration. Deep local knowledge, planning expertise and connection with local communities are capabilities that only councils can provide. Both tiers of planning administration must tackle the challenges facing our city and this involves tailoring metropolitan policy intent to local circumstances.

The Plan seeks to re-imagine and remake underutilised parts of our city so that Melbourne can shift from a dispersed city to a more compact one. As the principal place custodian of Fishermans Bend, the City of Port Phillip welcomes this focus.

Councils will build on our city’s history, diversity and creativity to maximise the opportunities presented by growth. To do so, we must be clear on the distinctions between areas of change and those of little or no change. All local authorities will have to balance the needs of these different areas to strengthen the qualities of each and grasp the potential of all.

Plan Melbourne is commendable in its promise of greater planning certainty.

Be it the development sector or the wider community, the lines and colours are on the plans. It is now up to metropolitan councils to determine how those lines and colours are interpreted by looking through local lenses, recognising local needs, to reflect local aspirations.

Since Plan Melbourne aims to build for growth, mechanisms for the provision of public transport and social infrastructure

A package of incentives will be needed to entice developers to come on board in the implementation of the new strategy.

The ‘business as usual’ planning and fiscal regimes will simply not deliver the housing and infrastructure we need. Further work is needed as part of the final strategy to

Tupungato / Shutterstock.com

For the private sector to be a key player in the provision of more diverse and affordable housing we will need much more than land use zoning and planning policy mechanisms.

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Plan Melbourne: A New Era for Melbourne’s Growth

must be better defined. Clarity on how sustainable development and mixeduse areas – embracing the concept of a 20-minute city – are to be achieved would be welcome.

The role of public-private partnerships also requires greater definition, that is, when does the private sector step in, and through which mechanisms, to ensure infrastructure is delivered.

Local government would welcome a constructive dialogue with the private sector on this front.

For Plan Melbourne to succeed, we need to build community trust in the planning system and strong co-operation between public and private sectors.

To get this right and mobilise the public benefits, we must be clear on what will be managed at the local and state levels.

Critically, many of these questions will only be answered once dialogue among the partners commences. The City of Port Phillip anticipates the composition of the new Metropolitan Planning Authority and looks to an effective working partnership to realise the Plan’s vision.

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Jennifer Cunich, Executive Director, Victoria Division

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he Property Council has welcomed the release of the Victorian Government’s planning blueprint, Plan Melbourne, and has encouraged the new Metropolitan Planning Authority (MPA) to move decisively on its implementation.

Key priorities will include the provision of funding, the establishment of clusters outlined in the document and ensuring that the MPA is staffed with those who have the appropriate experience to deal with the implementation process.

To date, the role and function of the MPA relative to the Growth Areas Authority still requires clarification. Given that the GAA’s work is not yet complete and the issues covered by the authority are vastly different from much of that covered in the MPS, it is essential that this distinction is identified and maintained. What is clear however is that action must take place quickly to ensure that the objectives of the document are carried out in an efficient and timely manner.

Due to the diverse range of topics covered in the document, the MPA needs to be staffed by a variety of experts including planners, economists and infrastructure specialists.

One way this could be enabled is through outsourcing to the private sector via secondment or borrowing employees to ensure the MPA has the required talent pool to accomplish what the document sets out to achieve. By involving the private sector in addition to consultation with stakeholders, it is possible to encourage co-collaboration which the authority will need if it is to be adequately funded.

Despite the fact that non-political stakeholders will need to have the largest voice with respect to advice (as they are the ones who will be implementing the strategy) local government must also have a voice in an advisory capacity. This is particularly important within the councils governing the clusters and the five subregions created in the document.

Plan Melbourne: A New Era for Melbourne’s Growth

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Gary Yim / Shutterstock.com

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

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Fifty Years of Growth in Knox

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Fifty Years of Growth in Knox

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

From Farms to Families and Factories: Fifty Years of Growth in Knox

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Peter Chaffey

Economic Development Coordinator, Knox City Council

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ver time, people have congregated in cities for two primary reasons -housing and employment. The City of Knox has met these requirements over its 50 years since becoming a municipality.

Looking back as Knox celebrates its 50th anniversary, much has changed over these decades.

Population growth was significant through most of this period, however it has now slowed and will plateau more in the future.

Despite this, development and investment have remained relatively strong.

Centrally located in Melbourne’s outer eastern metropolitan area, just 25 kilometres from Melbourne’s central business district, Knox lies just north of the EastLink–Monash/City Link Freeway intersection. Laid out in a ‘green and leafy’ setting beneath the Dandenong Ranges,

Knox now enjoys a reputation as a key provider of quality lifestyles aligned to, and supported by a prosperous, advancing economy.

Prior to becoming the Shire of Knox in 1963 (later proclaimed a City), Knox was part of the outer metropolitan food belt, with activities such as apple orchards in Bayswater/Wantirna and Brussels sprouts in Rowville. The area was also a destination of choice for recreation and holidaying, picnicking, walking, swimming at Heany Park lake and relaxing in guest houses in the Dandenongs.

During the Melbourne Olympics in 1956, the area was promoted to international visitors and the occasion marked with signage especially installed for the purpose.

Over time, Knox provided increasing access to what was becoming known as ‘Melbourne’s Playground via Wellington, Ferntree Gully, Burwood and Boronia Roads, which all still perform this function today.

Knox built an identity as a great place to visit, play and increasingly to live and work in; Land was subdivided and people moved in.

As far back as the late 1800s (1884), there was a strong debate emerging about the rail to Ferntree Gully. The foothills and Dandenong Ranges were a favourite destination for recreation and holidaying for Melburnians. At the time, there was debate if the rail line should come via Dandenong to Ferntree Gully (had this been pursued, the outer east would have had the north-south connectivity that is so lacking today) or via Ringwood.

The Ringwood route won out. At the time, it was felt Melbourne‘s growth was developing most in the East and this move would enable and support that.

The growth and development of Knox, in alignment with rail transport, represents foundational infrastructure leading growth rather than responding to growth. Wherever possible, it has remained a focus.

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Fifty Years of Growth in Knox

In the 1960s and 70s, Knox Council also had the foresight to set aside expansive road reserves lined with significant tree reserves along important spines like Burwood Highway and Boronia Road.

The early planning around this road and transport network put in place important infrastructure that still yields benefits today.

Large tracts of land at strategic locations were identified, set aside and designated for industry, business and trade. At the time, these areas were seemingly isolated but the Council of the day had a vision for a boom in residential growth over coming decades that would complement residential development, which is exactly what has happened. These areas were in places like Scoresby, Bayswater and Mountain Gate.

With regard to the continued focus on long term strategic planning for the

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

municipality, some of the bigger moves that occurred in the early 2000s included facilitating the transition of business land into the Scoresby-Rowville Employment Precinct--SREP. Previously, this area was zoned Industrial 1 and it became very apparent that the business and industry needs of the Knox economy were transitioning from traditional industry to reflect the knowledge economy. The SREP planning scheme amendment process rezoned the land to Business 3 and effectively enabled more office space to be included in the zone. This created interest in the Precinct from firms that were in the process of expanding or integrating the production and management aspects of their business.

Knox has continued to be very conscious of this and the need to be responsive to the indicators in our economy and from business. Looking ahead, we are seeking to ensure key employment nodes like Bayswater and Knox Central continue to

remain strong and influential and we will look at planning policies and zones to ensure they enable our emerging economic and business transitions.

Knox has always held the line with regard to retail development and stopping it from encroaching into areas for business and industry. This, of course, is becoming more difficult now with the recent changes to the commercial zones. Knox will be taking a close look at this and seeking to ensure our areas for employment, business and industry continue to be supported.

A key foundation of our economic strategy is to foster an economy that is based on solid production to generate wealth and prosperity, and not simply on the circulation of wealth via consumption.

In addition to this, Knox has been focused on its liveability for many decades.

Fifty Years of Growth in Knox

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Through planning and investment, Know has been maintaining and enhancing its unique features—for example the Dandenong Foothills (strongly protected and celebrated)—its green and leafy image and the link between the amenity of a place and its appeal to both invest and live in.

The idea of ‘living local’ permeates many of Knox’s plans, the ability to live, work and play local has always—in some form or another— been at the heart of Knox’s decisions, planning and investments in the place.

Over 50 years, Knox has focused on several key principles that have been instrumental in its lifestyle and employment success.

These are: • Targeted and regular strategic planning; • Strong development guidance; • Ongoing, balanced Investment; and

At 1.04 million in 2012, Melbourne’s eastern region currently has the second highest population in the metropolitan area.

Estimates in Plan Melbourne suggest that population growth up to 2050 is likely to be much lower than in other parts of the metropolitan area, in the 250,000k 350,000k range.

Whilst many may view this as a constraint on the future development of the City, it might equally be the case that the slowdown will enable council and its community to invest in further enhancement of the lifestyle and prosperity assets for which the city is currently renowned.

Disclaimer: This article is based on the personal observations and views of the author and should not necessarily be taken as representing the position of Knox City Council.

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Advocacy Update

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Advocacy Update State Pre-budget Submission Lodged

implementation of the Metropolitan Planning Strategy. This will be crucial to helping Melbourne retain its living standards by encouraging job creation, lifting metro-wide connectivity and boosting industry certainty.

T

he Property Council has lodged its 2014-15 Pre-budget Submission, which outlines the budget priorities for property industry in the upcoming financial year and beyond.

The Victorian Division will now begin to campaign on its submission to secure support for industry’s budget priorities.

The submission discusses the challenges impacting on Victoria’s prosperity and provides a number of recommendations to address these concerns. The policy topics and recommendations are grouped under six broad themes, encompassing tax reform, infrastructure, affordable housing, sustainability, economic management and planning.

We have called on the State Government to ease the property tax burden as a way to boost Victoria’s competitiveness and long term prosperity.

The Property Council advocates devising a land tax regime which attracts investment by reducing the upper land tax threshold from 2.25 per cent to 1.7 per cent. We have also asked the Government to restore competiveness to Victoria’s land tax regime by amending the property aggregation arrangements to more closely match NSW’s.

Fire Services Property Levy relief is another priority within our submission with the request to reduce FSPL rates in the MBF zone for commercial and retail property. The Property Council is continuing to call for equity in the FSPL model by requesting a discount for property owners which invest in fire suppression measures, as well as dedicated FSPL review mechanisms to assess business’ liability and prevent unduly punitive rates.

Infrastructure funding and financing also feature prominently in the submission.

To address Victoria’s multi-billion infrastructure backlog, the Property Council recommends solutions which harness the investment power of the private sector and superfunds, such as initiating a program of asset recycling. We propose that the State Government: • Explore long term leasing arrangements for the Port of Melbourne, • Begin recycling its share of the Snowy Mountain Hydro Scheme,

Fishermans Bend Draft Strategy Udeyismail / Shutterstock.com

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• Sell its current portfolio of vacated school and educational sites throughout Victoria, and; • Conduct a state-wide audit of council assets and public buildings and vacant land to identify all assets which can be sold to fund infrastructure.

Planning for a global city is another area in which we have focused on. We have recommended the creation of a dedicated Planning and Building tribunal staffed with qualified experts in planning or construction related fields to hear matters relating to planning or construction. This is important as currently VCAT requires a major overhaul of its function, efficiency and decision making capacity.

Rising construction costs and the lack of housing affordability is another area of concern. On this front the Property Council recommends establishing a government body to review all policies impacting on the housing sector before it is introduced, to acknowledge the cost impact of government policy on home buyers. The Property Council believes that housing affordability, a major competitive edge for Melbourne, will progressively worsen if left unchecked.

In addition to these requests, the prebudget submission highlights our belief that Plan Melbourne will require particular government attention over the next five years. The Property Council encourages the Government to move decisively on the activation of this plan and the

I

n September 2013, the Victorian Government released the Draft Vision and Design Guidelines for Australia’s largest urban renewal precinct, Fishermans Bend.

The documents’ release commences the consultation period for this precinct, which is expected to house more than 80,000 residents in the next thirty to fifty years.

Feedback from stakeholders and community will inform the Fishermans Bend Strategic Framework Plan, which will be released this summer.

The Property Council has submitted its response to Places Victoria on the two documents. The submission, which can be found on the Property Council website, outlines key priorties for the precinct including: • The establishment of an agreed vision in consultation with the community, public and private stakeholders; • Interim public transport solutions for Fishermans Bend; • A plan for community infrastructure needs based on population projections and forecasts; • A variety of mechanisms to fund the precinct’s development; • More flexibility in the design guidelines for the provision of affordable housing; and, • The introduction of minimum height limits across the precinct.

Property Podium

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

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Property Podium Uncovering the True Costs of Compliance Dave Allen

Managing Director, Corporate Property Consultancy

T

he recently released metropolitan planning strategy, Plan Melbourne includes a call to deliver 18 dwellings per hectare on average in new growth areas, by changing the precinct structure planning guidelines. Rather typically, the cumulative effect of this regulation on the property sector and community wellbeing is simply not mentioned.

The property sector bears the brunt of criticisms relating to the high price of construction in Victoria. However, a closer look will reveal that the majority of costs involved in property and infrastructure projects are not being appropriated by developers and construction groups, but rather the state and local agencies through which the sector must meet numerous regulations. These include (but are not limited to) developer contributions, water contributions, growth area infrastructure charges, golden sun month levies as well as hairy bandicoot and legless lizard contributions.

At the 2012 Property Congress, Lang Walker, the Chairman of Walker Corporation said that cost of compliance

in Australia was vastly more expensive than America and Asia, both areas where we are relying more on for Investment Funding. Indeed it can be seen that compliance costs in Australia look to have more than tripled in the past 10-15 years.

Property Council research has demonstrated how the cost per residential house in Victoria today attracts almost $83,967 in government related development costs. To consider that the average block sells for less than $180,000, this represents around 46 per cent of an asset’s value, before physical

servicing for the lot (roads, drainage, sewerage, water utilities, electrical connections, pavements to mention just a few) takes place and a team is hired to market the lot to potential buyers. These cost increases make development less efficient, making the block of land more expensive for the market.

Housing affordability is not the only aspect of social wellbeing affected by the vast number of regulations and rule changes; Victoria’s long term development is also being undermined. During a recent

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Property Podium

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

COST OF DEVELOPMENT

PER LOT

COMMENT

State GAIC

$8,408

The charge of $100,890 is levied on gross Urban Growth Zone land; assume twelve lots per UGZ hectare.

Council Development Contribution

$18,300

Typical charges are now approaching $275,000 per net developable hectare.

Melbourne Water Drainage Levy

$6,667

The drainage charges are estimated to be around $100,000 pwe developable hectare.

Golden Sun Moth / Growling Grass Frog Levy / Bandicoot Levy

$667

The charge of $8,000 is levied on Urban Growth Zone land; assume twelve lots per gross hectare. Note: GSM levy does not apply in Melbourne’s South East.

Threatened Species Levy (Melbourne’s North and West)

$233

It is assumed that 35 per cent of the area is native grassland and assume twelve lots per gross hectare.

Removal of native grassland vegetation (Melbourne’s North and West)

$3,208

It is assumed that 35 per cent of the area is native grassland with a habitat score of 0.4 and a target hectare score of 0.8 and assume twelve lots per gross hectare.

Rail Noise Policy

$20,000

Within 200 to 300m band of rail line.

New Water Charges

$6,500

The new policy framework will see charges rise from about $3,000 per lot to around $6,500 per lot.

Bushfire Attack Level Compliance

$6,000

Typical cost increase per dwelling to comply with new regulations.

New GAA construction standards

$6,000

Typical cost increase per dwelling to comply with new regulations.

Passive Open Space Land

$2,000

The GAA and Council require four per cent of the developable are to be set aside as passive open space. For the current purpose, it can be assumed the land is worth an average of $750,000 per hectare.

Passive Open Space Construction

$1,000

It can be assumed that passive open space construction costs approximately $500,000 per hectare.

Other costs - nominal amount

$5,000

There are a range of other costs; therefore a nominal amount is indicated.

TOTAL

$83,967

This excludes extra sales / marketing and developer margin costs which would increase the $83,967 by at least 33 per cent to over $100,00.

Source: Property Council of Australia (Victoria), Submission to the Standard Development Contributions Review (Stage 1), November 2012

meeting with a prominent developer, I was told of a report that had been commissioned by a large American investment house to explore the option of investing in new housing development in Victoria. The well-known international consulting firm was astounded at the level and costs of compliance in this state compared to the US and the reaction sentiment was clearly summarised by their comment “Moths!!! Don’t go anywhere near this state”..

In Victoria, the property sector provides the largest share of taxation revenue that is well above any other individual industry.

We have all heard from successive governments how they will significantly reduce red tape, but the property sector continues to be stifled by ever increasing

layers of compliance. Unless the sector is released from the layers of red tape it will be too suffocated to sustain the much needed supply of housing for a growing population.

The Victorian Government now has a visionary strategy for planned growth in Melbourne. Executing the vision will require a practical understanding of the sector’s needs for efficiency and certainty, which are inextricably tied to the issue of reducing red tape and regulation.

Beyond the business case for red tape reduction, there are social concerns which are arguably even more urgent.

Picture a young couple with two children moving into their new 22 square meter home in Werribee in 2001. The two kids run out to the back of their 710 square meter lot and kick a ball around the 18 by 15 meter garden, whilst their parents celebrate with glasses of champagne.

Ten years and a fivefold increase in compliance costs later, a similar young couple with two children move into another 22 square meter home in Werribee. The children run to the back of their 420 square meter lot, kicking a ball against the back fence which sits three meters from the back door. By accident, they knock over their parents’ celebratory glasses of champagne.

We have effectively ‘over-regulated’ our communities from a space to enjoy their lifestyles. Government admit this in calling for minimum lot areas of over 500 square meters, but we must remember that it was the continual pressure of growing list of regulations that have brought us to this stage in the first place. For the sake of our muchtouted liveability and the future of our communities, we cannot afford to ignore Victoria’s developer cost escalations.

Mentor Program 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Update: Mentor Program 2013 Leader and mentors: are they at one?

On 16 July 2013, the Property Council’s Mentor Program held its second Touch Point Networking Evening, marking a half-way point in this year’s program.

There is a common adage that an organisation takes on the persona of its leader. Successful organisations are moulded by example and, arguably, nobody is better positioned to set a greater example than the leader.

Steve Joffe Managing Director, property placements

Mentoring can be both informal and formal. In the case of the Property Council’s Mentoring Program, the process finds structure in having a distinct form and shape. Informal mentoring on the other hand, takes place on a day to day basis in every organisation, every situation, every household.

Often, it is simply a case of “following the leader”.

Since our behaviours and actions can influence others without us knowing or realising, sometimes we are actually acting as mentors whether we have intended or not.

In a business environment the leader has enormous responsibility, because they will be followed by those who respect them for not only what they do, but also what they say. There is a good chance those employees will mimic behaviours and attitudes, so sending the wrong message from the top risks perpetuating a negative outlook through every level in the organisation.

On the other hand, leaders who consciously provide solid counsel, communicate positive values and share knowledge will gain tremendous benefit from imparting their wisdom and friendship.

Throughout my journey in the property industry, I have had the pleasure of mentoring both officially and unofficially and am pleased to have witnessed a number of my direct reports achieve enormous success both locally and overseas. I have seen young people given great responsibility with the right mentoring and support; I have witnessed how they have grabbed these opportunities and prospered.

An individual is only as good as the people around them.

We need to harness talent and provide ‘the space’ and direction for individuals to grow. The amount of satisfaction from seeing your direct report become your manager is very enriching and rewarding when you have played a part in that success story.

So my message to mentors is: mentor others as you would like to have been mentored in your life. Give of yourself and give generously, but above all, give honestly and with integrity, then watch how your leadership creates the persona.

Thanks again to our Program partners.

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Spotlight on Tasmania

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Spotlight on Tasmania Mary Massina

Executive Director, Tasmania Division

I

n the last days of the parliamentary term, the Tasmanian Government has been tabling important legislation for the industry.

In early October, the Land Use Planning and Appeals Amendment Bill was passed by the Lower House.

This Bill is the culmination of significant lobbying by the Property Council of Australia, the Housing Industry Association (HIA) and the Master Builders Association to ensure the government acted on some of our planning reform agenda.

The Bill relates to: • Extending private certification to residential developments that are permitted under certain specified planning schemes; • Formalising a process for dealing with applications that do not require a permit such as those for single dwellings, garages and sheds in standard residential zones; • Providing the Minister with the powers to be able to declare in any planning scheme particular uses or developments which can be privately certified; and • Providing a process to allow 43 development applications to transition through the interim planning and

full planning schemes process by combining the permit and dispensation applications instead of the current two staged approach as well as tightening the timeframe for the consideration of dispensations.

The Planning Minister has also highlighted that third party appeal fees will be increased from the current $73 to $303 and that consideration will be given to fees being a percentage of the development cost in tribunal hearings.

These are significant wins for our industry and for the Property Council.

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Spotlight on Tasmania

However, with the Local Government Association of Tasmania signalling that it intends to fight the private certification changes in the Legislative Council, the struggle for reform has only just begun.

The Property Council garnered another win when the Government accepted our amendments to its Historic Cultural Heritage Bill.

Without a “prudent and feasible alternative test” in the Heritage Act, members such as Citta will no longer be forced to wade through lawyers and court hearings to test the veracity of this subjective assessment.

Economic or commercial viability now has an equal place in the assessment of heritage with the alignment of LUPAA within the Heritage Act.

These major wins are a culmination of twelve months of hard lobbying, demonstrating to our members that the Property Council can and does deliver solutions to industry issues.

Developer charges are another area that we have been advocating against over the past five months. The Property Council achieved a significant win when the Liberals announced that they would waive water and sewerage charges for two years should they win government.

Furthermore, the Property Council has lined up Aurora developer charges and we are pushing hard to see them significantly reformed, if not waived, in line with the water and sewerage charges.

Through our advocacy work, State Government, Tasmania’s 29 councils and the general public are now acutely aware of the need to address developer charges so that the State can jump start investment and jobs.

The combined strength of the HIA, Master Builders and the Property Council saw the removal of the Residential Disputes and Warranties Bill on the basis that it was detrimental to the industry as a whole and in particular mum and dad builders, and the very consumers the Government wanted to protect.

Having a bill thrown out is an exceedingly rare event but it shows the value of the Legislative Council and the strength of the industry’s argument.

Again, through the combined strength of the industry’s lobbying efforts, the proposed restructure within the Department of Justice, which would have seen Workplace Standards and the Building Control Unit merge with Consumer Affairs, has been halted. This proposed restructure would have been detrimental to the industry, which pays the levy that funds the Building Control Unit as well as skewering the already questionable level playing field.

Still left on the table for debate is the Government’s proposed Aboriginal Heritage Bill. This Bill has been the subject of a number of meetings with the Minister, his office and the Department. While the Government has moved to allay the industry’s concerns regarding the process, it remains to be seen as to whether it will pass the Upper House given its complexity.

As always, the Property Council is working to ensure employment and the vibrancy of Tasmania’s largest private sector industry is secured.

In the lead up to the state election the Property Council fully intends to cement the industry in the minds of our politicians and deliver the industry’s reform agenda.

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Events

WOMENS GOLF DAY 30 OCTOBER 2013

Womens Golf Day Proudly partnered by:

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Events

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4 ART’S SAKE 7 AUGUST 2013

4 Art’s Sake Speakers: Leigh Carmichael, MONA

Proudly partnered by:

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Events

FOOTY LUNCH 20 SEPTEMBER 2013

Footy Lunch Speakers: Sam Kekovich Gary Ayres

Proudly partnered by:

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Events

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Events

MID YEAR CELEBRATION 8 AUGUST 2013

Future Directions Mid Year Celebration Proudly partnered by:

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Events

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Events

FUTURE DIRECTIONS 26 SEPTEMBER 2013

Flinders Street Design Competition People’s Choice Winners Speakers: Eduardo Velasquez Manuel Pineda

Proudly partnered by:

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Events

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Events

FUTURE DIRECTIONS 29 AUGUST 2013

Future Directions Super Towers Debate Speakers: Mark Wizel, CBRE Michael Buxton, RMIT

Proudly partnered by:

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Events

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FUTURE DIRECTIONS 8 OCTOBER 2013

The ConneXion Proudly partnered by:

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Events

GALA BALL 17 AUGUST 2013

Annual Gala Ball 2013 Proudly partnered by:

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Events

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Events

RETIREMENT LIVING SUMMIT FOR VILLAGE MANAGERS 17 AUGUST 2013

Retirement Living Summit for Village Managers Speakers: Stuart Nicolson, Retirement Alliance Nerida Conisbee, Colliers International Pat Hems, Retirement Communities Australia Mary Wood, Retirement Living Council John Begg, Leading Ag Services Australia (Victoria) Lisa Rollinson, Brotherhood of St Laurence Kathryn Elleman, Russell Kennedy John Lovell, Lend Lease Sue Say, Urbis Terry Macdonald, Residents of Retirement Villages Victoria

Mayor Partner:

Supporting Partner:

Retirement Living Council Village Manger of the Corporate Partner: Year Award Sponsor:

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Events

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INDUSTRY BRIEFING 17 AUGUST 2013

Industry Briefing Speakers: Hans Kunnen, Bank of Melbourne Peter Bowtell, Regional Buildings Leader, Arup - Moderator Linc Horton, General Manager Property & Development, Melbourne Airport Bryan Thompson, General Manager Strategy, Planning & Development, Melbourne Airport

Proudly partnered by:

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Events Calendar

PROPERTY VICTORIA NOVEMBER/DECEMBER 2013

Visit www.propertyoz.com.au for all the latest on our events.

Events Calendar Victoria DAY

DATE

EVENT

VENUE & TIME

Friday

6 December

Christmas Lunch

Peninsula at Atlantic Central Pier, 161 Harbour Esplanade, Docklands 12noon for 12.30pm - 2.30pm

Thursday

Office Market Report

6 February

ZINC at Federation Square 7.15am for 7.30am - 9.00am

Thursday

13 February

Outlook 2014

Crown Conference Centre 7.15am for 7.30am - 5.30pm

Wednesday

26 February

Business Lunch With Premier Denis Napthine

Location TBC 12noon registration for 12.30pm - 2.00pm

Thursday

7 August

Office Market Report

TBC

Friday

19 September

Footy Lunch

Crown Palladium Ballroom 12noon for 12.30pm - 2.30pm

Tasmania DAY

DATE

EVENT

VENUE & TIME

Wednesday

11 December

Future Directions End of Year

The Henry Jones Art Hotel 25 Hunter Street 6.00pm - 8.00pm

Thursday

6 February

Office Market Report

The Henry Jones Art Hotel 25 Hunter Street 8.00am for 8.15am - 9.45am

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