Mixing It - Special Report

RobertsDay

special report_mixing it

special report_ mixing it Is product diversity the key to making money in tough times?

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises

the key to_ maintaining sales in tough times It’s no news that the GFC hit all of us hard. As some said when interviewed for this report: it was just horrific. Looking at the decade ahead it also seems that some challenging years still lie before us. What then is the key to maintaining sales in tough times?

While compact may be the new black, the road to maintaining sales in tough times is more nuanced than large precincts of ever smaller homes on ever smaller lots. As Ellenbrook developer Danny Murphy puts it: “People don’t want to live in a precinct of 500 small homes.”

For Danny Murphy, and others who not only survived but thrived during and post the GFC, product diversity – a mix of housing types, sizes, styles and densities that allow residents to grow within a community – is key. But it isn’t the silver bullet. It needs to be backed by a ‘whole of life’ design approach aimed at building communities. (And savvy developers also look to capitalise on the funding and investments of others.) When that’s done, sales rates and a developer’s balance sheet are better placed to weather volatile times.

2

How to make healthy profits in tough times? In this report we share the lessons we’ve learned sitting alongside some of Australia’s leading developers; insights to help us all navigate the uncertain times ahead.

Welcome to this RobertsDay Special Report.

Deon White Managing Director

special report_mixing it

3

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises

crystal ball_ the next decade The GFC may be (just) past but rocky times still lie ahead. Industry leaders take a look at the future and the top themes on developers’ agendas.

While UDIA CEO Richard Lindsay says that looking at economic conditions five to 10 years down the track is fraught with danger – “The GFC wasn’t predicted six weeks out!” – commentators agree on the fundamentals.

“Certainly, we are operating in an environment of global economic uncertainty, federal political uncertainty and lack of price growth. Confidence is down and that will dampen a housing recovery,” says Oliver Hume National Head of Research, Andrew Perkins.

Peter Dransfield

4

Devine Group Chairman Peter Dransfield agrees. “I think the market will stay subdued for the next couple of years. That’s partly to do with confidence: consumer confidence in buying a house.

On the other end though are the banks: they have been a massive constraint, very conservative, wanting substantial presales.”

special report_mixing it

Yet there is light ahead. According to Oliver Hume Research, the drivers of demand for shelter are – and always have been – fourfold: population growth, household growth, consumer confidence and affordability.

As Perkins says, Oliver Hume’s analysis of those four key drivers leads them to believe that while the recent past has been tough, future growth is promising.

“After all,” he says, “one thing is abundantly clear: Australia’s population – the main driver of housing – is set to grow strongly.”

According to the ABS Series projections, Australia’s population will grow at an average annual rate of 1.4 per cent over the next 10 years. The post-census estimate of our population at June 2011 was 22.3 million, projected to grow to 25.6 million

by June 2021.

over our shoulder_ The Global Financial Crisis hit quickly and it hit hard. Four developers recall its impact on their business and the industry at large – and the effects still being felt.

That is an average increase of 330,000 a year, compared with an actual increase of 255,000 in 2010-11.

Added to population growth, the reality is there is still a shortfall of housing in Australia, and that’s a fundamental. With this in mind, the underlying requirement for housing is forecast to rise to around 180,000 by 2017. Pent-up demand is likely to rest at around 100,000 by 2017.

So while confidence in some sectors is down, on the other hand population growth is accelerating and there is a shortage of housing in almost all states. Perkins points out that affordability is also improving, rental vacancies are low and that house and unit prices have stabilised. “Confidence will therefore return as economic growth accelerates,” he says.

1.4%

projected annual average growth rate of Australian population over the next 10 years

In this context, what are the things to focus on, to both future-proof for uncertainty and be ready for growth? Key industry players share their top themes for the decade ahead.

PAUL SADLEIR MANAGING DIRECTOR, CEDAR WOODS I don’t think anyone expected it to be as sharp and dramatic as it was. The seeds were there many years ago with companies getting over-geared but we were all a little caught out how quickly it happened after Lehmans went down. Everything was out of control and you sort of had to hope and pray a little bit.

Once life went on, it was very much about looking at finance. As a sector, banks had an allergic reaction to many forms of residential investment. We saw a number of developers who were just unfortunate at the time the crisis hit – because they were not in a good cash flow position at the time, so they went under.

The key thing now is not to overextend and to ensure strong balance sheets.

The days of over-gearing and over-leveraging are past – as a consequence we’re not as fast as we used to be. It’s like we’re in third gear rather than fourth gear but we’re less likely to crash.

5

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises

01_

Pent-up Demand/Over-supply of Housing, Australia

Dwellings '000 150

Pent-up demand 100

Diversity will be imperative

50

0

-50

-100 Over-supply -150 1991

1993

1995

1997

1999

2001

2003

2005

2007

'000

2009

2011

2013

2015

2017

Source: ABS, Oliver Hume Research

Years ended June

Housing Starts and Underlying Requirements, Australia

200 Underlying requirement

190 180

Starts

170 160 150 140 130 120

forecast

110 1997

1999

Years ended June

2001

2003

2005

2007

2009

2011

2013

2015

Source: ABS, Oliver Hume Research estimates and forecasts

2017

During the ’70s, ’80s and even ’90s a lot of developers had no diversity at all, says Mirvac’s Development Director of Masterplanned Communities, Kim Lawrance. “It created stagnant suburbs without the flexibility to fit with people’s changing life cycles,” he says. “They were monotone developments, and now we need to see more diversity: products for first homebuyers right through to fourth homebuyers.”

Product must meet both aspirations and expectations, however. “Just rolling out the same old stuff won’t work. So there will be different building materials that condense timeframes, mixed-use areas and apartments, adaptable buildings – that part of the market is still fairly young.”

PETER DRANSFIELD CHAIRMAN, THE DEVINE GROUP The GFC was horrific. A number of things happened. The market collapsed, the banks toughened up and anyone producing residential property who had stock faced massive write-downs and losses so had to restructure their whole business.

Most organisations in that field probably lost 20% of their worth through a write-down of assets and if it was only 20% they probably did well.

We’re still suffering the overhang quite frankly. It brought all sorts of international banking and finance issues: it changed the behaviour of banks, of government, and it weakened the confidence of the buying public so far as residential property is concerned. It started then and has persisted right through to this time now.

6

special report_mixing it

Lawrance points out that ultimately the success of any project is its performance in 20 years time. Has the area developed over time? Has the suburb evolved? In that respect, master plans must be flexible enough to adapt over time to meet changing conditions – which helps developers create a legacy.

“I don’t know what the market will be in 10 years time,” Lawrance says, “so I need a master plan that can adapt.”

02_

Affordability is key – and not just to buy Cedar Woods Managing Director Paul Sadleir agrees with many that affordability will play a key role in the coming decade. “Pre-GFC,

finance was more readily available for purchasers but that’s not so much the case now,” he says.

“People are more likely to go back to buy a smaller home and add to it rather than buy the bigger house.

So there will be a focus on smaller product – product that is better designed and more affordable.”

Affordability over the long term will be a key influencer amongst home buyers, agrees Gavin Hegney, a valuer and Founding Director of Hegney Property Group. In 10 years time he believes the underlying cost of living will be the number one challenge for consumers – and that will inevitably flow into the cost of housing.

“People will simply have less money to spend on housing,” he says. “In 10 years time people will look far more closely at how much it costs to run a house. Rather than it being a ‘maybe’ factor in decisions, houses that are cheaper to run will be much more of an influence in the next 10 years.”

Gavin Hegney

KIM LAWRANCE DEVELOPMENT DIRECTOR, MASTERPLANNED COMMUNITIES, MIRVAC Mirvac had to downsize; we had exposure issues and are still dealing with the residuals now. Certainly it had a long-term lasting impact. The business has become more conservative: risk and managing risk has become a much more mainstream issue for the business, from a board level down.

We’ve changed our product mix. People want bang for buck in a built form outcome and one way to do that is keep the house size the same but decrease the block. So we’ve become more efficient in our lot sizes to become more affordable.

The key thing now is, are we realistic in assessing the cost to develop a project? Are we realistic in what needs to be invested: in buyer profiles, demographics, market potential? Are we looking at marketability and competing projects?

7

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises

03_

Small is the new black Size tends to go hand in hand with affordability and Managing Director of the ABN Group and Dale Alcock Homes, Dale Alcock, says that the last three years has very much made consumers question the scale of mortgage they want.

Dale Alcock

“I believe we’ve tipped the scale in terms of growth of average house price,” he says. “A lot of that’s about affordability but it’s also about people’s desire to live a little bit and not just live to pay off the mortgage; that maybe having a little bit tucked away for a rainy day is not a bad idea.”

“There’s also been a capping out in growth of house sizes.

The ever-increasing average home size – that peaked in my opinion 18 months to two years ago. I don’t think we’ll see a turnaround of ‘Lets go bigger, bigger, bigger’ again.”

Indeed, Devine Chairman Peter Dransfield believes that embracing small lot product is something the industry has done particularly well.

“There are a lot of smaller lots happening and that’s one of the things probably saving the market,” he says. “There have been massive moves in that direction. It hasn’t gone all the way but by gee I think the industry has done well here, in getting lot sizes down, introducing terrace houses to greenfield areas. Of course, variety is key, so it needs to be kept in balance.”

MARK HECTOR MANAGING DIRECTOR, QUBE When the GFC hit some people buried their head in the sand and said it was all too hard. Others said, ‘Okay, this is happening. What can I learn from it and where are the opportunities?’

We were cautious. We had to adjust our expenditure: from a business point of view we didn’t take on any more staff … and we scaled back marketing costs because there’s no point promoting a product for which there is no market.

But we also became more innovative in our thinking. For every downturn there’s an opportunity. We looked at stressed opportunities from an acquisition point of view and from a product point of view we reduced block sizes to where the market was.

When things get tight people move to smaller blocks; when things are bullish they go for a bigger block and price tag – it’s the arithmetic of what’s affordable at the time.

An experience like the GFC means you need to be flexible and have the ability to move – and move quickly. It reshapes your thinking and forces you back to earth a bit. While it was not pleasant for anyone it was inevitable and as a result those still operating are doing well now; and those who were too highly leveraged are perhaps no longer in the business or struggling – or both.

8

special report_mixing it

04_

Trade-offs for accessibility While ‘location, location, location’ is a long established real estate mantra, Paul Sadleir, Managing Director of Cedar Woods, says it’s now even more important.

“Freeways and railways around Australia are starting to struggle under the load so if you can provide housing close to key infrastructure that will be valuable. People will start to trade off a long commute to a larger home for a shorter commute and a smaller dwelling in an inner ring suburb.”

Gavin Hegney agrees that accessibility to cities and transport will become more important, as will walkability. “Walkability can give property its value,” he says.

“People will want to walk out their front door and access the things they like. Therefore they may well trade their bigger block for a smaller one if they can walk to a café, shop or park.”

“People will start to trade off a long commute to a larger home for a shorter commute to a smaller dwelling.”

Paul Sadleir

9

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises

lessons from_ Ellenbrook The market was down, confidence was shot. Yet one developer’s recipe for success during and post the GFC involved investment in two core areas: diversity and community.

When the GFC hit, Western Australia’s Ellenbrook Management Pty Ltd faced the same threat as all developers: nervous banks and nervous consumers. In response, the developer of Australia’s most awarded new town devised a highly targeted response of investing in two core strategies.

LWP Property Group had already weathered many storms; the first earth was turned at Ellenbrook, thirty minutes from Perth, 17 years ago. Since that time, LWP had concentrated on the town’s four core attributes: community, diversity, environmental enhancement and scale.

Danny Murphy

10

“We have attended to those brand attributes over the last 17 years and particularly highlighted two of them in dealing with the GFC,” explains Danny Murphy, Managing Director of LWP. “It was obviously a challenging time but

we managed to limit the damage so that we came through it maintaining a reasonable turnover and margins.”

The first area of response was diversity: ensuring a wide range of housing to meet changing demand. In fact, Ellenbrook boasts the widest range of housing types and lot sizes of any urban development project in Western Australia, with cottage lots of 150m2 to country lots over 1,000m2.

“You’ve got to have diversity,” Danny Murphy says. “Diversity keeps the cash register ticking over as you can access a range of different market segments at any point in time.”

In times of financial uncertainty and fluctuation, he adds, such as the last few years, it can prove vital.

special report_mixing it

“It’s been a difficult period recently predicting exactly what segment is going to walk through the door. All of a sudden the second homebuyer re-emerges, then negative press comes from Europe and they pull back.

Then investors are alive because interest rates are dropping so they can positively gear. So it’s been a very difficult period to predict – and we’ve found the way to manage that risk is to have a diversity of product to work with.”

Greg Carter, General Manager of Homebuyers Centre, works closely with Ellenbrook on

building new homes. He says Ellenbrook is one of only a few localities with a genuinely diverse mix of houses.

“Most estates have traditional blocks, then the next version is cottage lots,” Carter says. “At Ellenbrook they took it further and created medium density lots. That was cutting edge back in 2006.

They were only 8 metres wide by 30 metres deep, terrace-type lots and there might be six to 10 in a row to create a higher density. That was innovative but they took it to a whole new level in 2010 with a new idea to bring lot sizes down to 5 metres

“Diversity keeps the cash register ticking over as you can access a range of different market segments at any point in time.”

DALE ALCOCK: WHY COLLABORATION IS THE FUTURE To generate ground-breaking ideas that convert into successful new product, one of Australia’s most influential builders argues everything begins with one approach: collaboration.

“We’ve been at Ellenbrook since day one when it was just pine trees and a whole lot of sand,” says Dale Alcock, Managing Director of the ABN Group.

“And the great thing about it is it’s a visionary project.”

Much of that vision has resulted in a series of firsts for Western Australia, such as the combination of a cottage lot with rear loading.

“Danny [ Murphy] is a smart operator and has tested the boundaries at each point. It was very early on out there that we did the first rear lane 12 metre cottage project,” Alcock recalls. “Lo and behold we decided to go ahead on the basis of something different and worth trying. And rather than it be just a home that we put on the ground, it outperformed our normal product at the time. It was the first time that a rear-loaded 12 metre wide product had been seen in Western Australia.”

Diversity initiatives like rear loading, smaller lot sizes and more affordable price points are all hallmarks of Ellenbrook’s success. And they have all, in Alcock’s eyes, stemmed from a culture of collaboration between developer, planner and builder.

“Builders and land developers haven’t always operated with such closeness but [our] tight relationship with LWP, and [with] us and LWP and RobertsDay, means we push around ideas and come up with better solutions.

“It’s the builder, planner and developer working together, working our way through the issues and snags. From the outset that has always been the case at Ellenbrook and that is relatively unique.”

Moving forward, collaboration will also mark the difference between projects that sell well and those that don’t.

“As we change lot sizes and get down to smaller lots, the earlier that builders can be engaged the better. Because if planners and developers work in isolation, or bring the builder in too late, it won’t work.”

11

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises

33% of our leads come from existing residents.

by 30 metres deep. Now that had never been done here before – well, not since the 1930s and 1940s, anyway.”

In Danny Murphy’s words, the move to develop more diversity through compact home options was a direct response to uncertain economic times.

“Years ago people wanted to buy more land than they needed because they were convinced that was a good long-term investment,” Danny Murphy explains. “Now they’re not so confident, so are more content to buy what they need. And that’s brought very much into play the more compact housing options.”

And with the market starting to embrace smaller homes, diversity is more vital now than ever.

“People don’t want to live in a precinct of 500 small homes,” Danny Murphy says.

“So you work hard to make all the ingredients come together so that overall you get a vibrancy in the total project and in each neighbourhood. We work hard at planning the total project level, the neighbourhood level, the street level and the house level – you have to tackle each of those four layers.”

After diversity, Danny Murphy’s second front against the GFC

GREG CARTER: HOW ELLENBROOK SMALL LOTS REVOLUTIONISED THE MARKET If it’s small and it’s smart, it can be revolutionary. One collaboration between a developer, planner and builder to investigate affordable housing took the market by storm.

In 2009 LWP Managing Director Danny Murphy called a meeting with Homebuyers Centre General Manager Greg Carter and planners RobertsDay. The agenda: to create more affordable housing. The specific agenda: to create homes on a 5 metre wide lot.

As Carter recalls, he was intrigued, but he had provisos.

“One: could we practically fit on such a small site? Two, was there a market? And three, what would the finance sector think of it? Because regardless if I liked it and the consumer liked it, if the finance sector wouldn’t give mortgages out to purchase one of these things, what was the point?”

Two years later, the Primo range of homes was launched at Ellenbrook. Not only did they include homes on a 5 metre by 30 metre block, but those homes were 25% cheaper than existing product. At the time the average price of a home and land package for first homebuyers in Perth was $359,000; the Primo home and land packages averaged $270,000.

The response to the launch was overwhelming. “We built 12 homes and could have sold them three times over on the first weekend of opening,” Carter says.

Today there are over 100 examples of these lots in Ellenbrook and Carter calls the Primo development the most significant project Homebuyers Centre has undertaken in its 20-year history.

“Affordability is the key to everything now,” he says. “It’s a whole new world where finance is not as available as pre-GFC so bringing products to market with a relatively affordable retail price is very attractive. You just can’t buy any cheaper than this for a brand new home.”

12

special report_mixing it

was to support the growth of the Ellenbrook community.

“When tough times emerge, do you pull back on your community development programs? Our response is that, actually, that’s the time you make sure you don’t,” he says.

“One of our key attributes here is community and looking after those people who have already bought in Ellenbrook, now over 22,000 of them.

They are your best sales people – 33% of our leads come from existing residents.”

Ellenbrook management allocates approximately $400 per lot, matched by the City of Swan, to a community account for civic facilities and community workers.

It has launched the Ellenbrook Cultural Foundation, sponsored arts-related groups, and in all now boasts 65 community groups within the town, from charity and arts organisations to sports clubs.

As far as Danny Murphy is concerned, that commitment to growing a varied and busy community has unequivocally paid off.

“Since 1995 we have averaged over 400 lot sales per annum. We dropped down to 375 in the GFC year and last year was tough but we averaged over 435. There’s a nexus between the way you look after residents and your

Ellenbrook: A recipe for success Diversity is a key ingredient in Ellenbrook’s success. But in a post-GFC world, one ingredient is not enough. Here are another 7 from Ellenbrook planners, RobertsDay

01_

An urban structure Ellenbrook balances a town centre with seven villages, creating a variety of urban and village places interlinked by an open space network of cycle and pedestrian paths that brings the daily needs of the aged, parents and children within walking distance.

02_

vibrant town centre Ellenbrook’s town centre includes A ‘main street’ retailing within a high quality public realm and a variety of high-density apartment living.

03_

Affordable housing Ellenbrook has affordable options: not only does it have public housing but 40% of its residents are first homebuyers.

04_

A community plan Ellenbrook management and the City of Swan jointly contribute an amount upon the sale of each lot to a community account, funding facilities as well as a Community Development Officer.

05_

A Cultural Foundation An independent entity, the Ellenbrook Foundation promotes and creates cultural events around art, literature, music and theatre.

06_

Public art From inception, Ellenbrook engaged a community artist to inform the project and create public art; it has been a catalyst in broadening the community’s cultural dimension.

07_

ense of place A distinctive local identity fostered S through its intimate village structure and meaningful application of architectural, landscape and place-making initiatives.

13

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises

success formula_ four roads to recovery In an era of financial turbulence, design diversity is the developer’s best insurance, argue RobertsDay planners Janine Egan and Tim Trefry. In addition to the lessons learned from Ellenbrook, they share four other keys to success.

01_

Identify the gap

There’s a reason Marketing 101 makes a mantra of ‘Know your target market’. It’s because it’s simply fundamental.

“It’s one of the first things we do,” says RobertsDay Principal Tim Trefry. “Despite the fact that RobertsDay is a firm of town planners and urban designers, we also consider ourselves marketers almost as much as a developer’s marketing team.”

It’s why the Discover phase of RobertsDay’s Great Places process has the team researching specifically who could be buying in the development, what housing choices are currently available in the area, what the pricing is, what competitors are offering and how successful sales generally are.

That analysis then helps the team identify the gap.

14

One project where this approach has worked particularly well is North Eglinton.

RobertsDay is the project designer and planner on the joint venture between LandCorp and the Satterley Property Group. Located within the northwest corridor of metropolitan Perth, the 240 hectare site has a potential yield of 3,400 dwellings.

Using a detailed competitive analysis prepared by Satterley on the available stock by lot size, cost per square metre and lot price, overlaid with product mix, sales and purchasers’ borrowing capacity, the team has been able to translate this wide range of information into detailed recommendations for the product mix most likely to be successful at North Eglinton.

special report_mixing it

02_

Focus on the front Are people really more designsavvy these days? Research suggests they are. And RobertsDay Senior Associate Janine Egan maintains that with the rise of smaller blocks and smaller homes, people are even more sensitive to design quality.

While all elements that make a house great should be taken care of – comfort, light, functionality, materials, space and proportion – there also needs to be a real focus on the front.

“It’s critical that we work out how the dwelling relates to the street,” Egan says. “Is the front verandah or balcony useable so that people can fit a table and chairs? Are front entries easily found? Does the garage dominate or is it sensitively

incorporated or tucked away at the rear? And does the dwelling have appeal from the street?

“All of these design elements can help strengthen the relationships and flow between people, architecture and place.”

While RobertsDay people are planners not builders, they know that having a process that frames early interaction between the client, consultant and builders is fundamental. (It’s also why the Envision and Design stages of RobertsDay’s Great Places process practises this type of interaction and product development.)

Egan explains that one project where this was done early and well was at Harvest Edge. Designed by RobertsDay and Simon Youngleson, and delivered by LandCorp in conjunction with ABN Group, Harvest Edge is located 22km south of Perth. Despite its fringe location, its 53 dwelling lots and 264 dwellings include townhouses, maisonettes and apartments.

It was also the winner of the 2010 UDIA (WA) Award for Excellence

“It’s critical that we work out how the dwelling relates to the street… these design elements can help strengthen the relationships and flow between people, architecture and place.”

Janine Egan

15

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises for Medium Density Development, and a commercial success.

By involving the builders early and having them work closely with the designers, the Harvest Edge team was able to create a contemporary urban village where homes were designed to take advantage of lots oriented for passive solar design, and to provide integrated indoor and outdoor living areas.

In particular, locating garages at the rear enabled generous front verandahs and balconies. This, combined with well-articulated facades incorporating a variety of colours and materials, means that the houses look different but are also unified by a common thread to create a sense of place.

03_

Look back It’s axiomatic that compact housing goes hand in hand with rearloaded lots and the rear laneway.

Moving the garage to the rear not only reduces the front setback, enabling the overall lot size to be smaller, but it also resurrects the laneway as a place for children’s play and social interaction.

“It not only makes economic sense,” says Tim Trefry, “but the case for laneways is compelling.

Our research demonstrates that in terms of capital outlay by a developer on a 200m street, a row of 7.5m rear laneway lots not only represents a similar per lot cost as a row of 12.5m front loaded lots, but returns a higher sales price per square metre.”

One project – aside from Ellenbrook – where the rear has been resurrected with great success is Greater Ascot. On a 350 hectare

Tim Trefry

16

“… in terms of capital outlay by a developer on a 200m street, a row of 7.5m rear laneway lots not only represents a similar per lot cost as a row of 12.5m front loaded lots, but also returns a higher sales price per square metre.”

special report_mixing it

site in Townsville, the Parkside Developments project is expected to yield about 2,600 dwellings and be home to 7,000 people.

Designed around the theme of healthy living, with a large focus on walkability, quality green spaces, and a variety of dwelling types to engage with people on the street, a key differentiating point for the project has been the resurrection of the laneway as a place for social interaction.

The first stage of 39 lots has been built, with about 25% of Stage 1 featuring laneway product, priced at about $50,000 less than a conventional lot. ”So far, it’s had a good market response,” says Trefry.

04_

Build buy-in Once in place, planning rules, regulations and zoning are not only difficult, costly and time-consuming to change, they also tend to inhibit innovation and diversity.

Egan says the early relationshipbuilding with government agencies laid down in the RobertsDay Great Places process is fundamental to breaking down these barriers. On top of that, the

collaboration created through the RobertsDay Place Design Forum – a tool to engage stakeholders and build consensus around a project vision and design – is one of the most effective and efficient ways to achieve the buy-in that supports diversity.

One project where that was used particularly effectively was Broome North, the most significant land development project in Broome’s history, comprising 695 hectares and the doubling of Broome’s current population. The project will produce 4,800 housing lots for 12,000 people, two local centres, four schools and a light industrial precinct.

Challenged by the State Government to urgently address housing supply to ease the spiralling housing shortages and affordability crisis facing Broome, LandCorp worked with RobertsDay to secure all planning approvals, including rezoning, district and local structure planning, and subdivision approval, within 12 months. LandCorp was also able to commence construction of Waranyjarri Estate (185 lots), Broome North’s first stage.

Adds Trefry: “And, in an environment where people had grown up with big blocks that housed a home, a boat and a caravan, our challenge was getting them interested in product they’d never been offered before.

The Forum was a way to open up that discussion.”

The result has been that early sales in the Waranyjarri Estate demonstrate there is a market for smaller product in Broome: the smaller lots at price points sub$200,000 have been the first to go in each successive land release.

In addition, the four-day Place Design Forum, convened in Broome, which allowed the community and other stakeholders to share a deep understanding of the unique attributes of the place and its people, as well as collectively resolve issues and concerns, has been hailed by Shire President Graeme Campbell, as “the most important planning event in Broome’s history.”

“As a yardstick it is not uncommon for these approvals to take five or more years to obtain,” says Egan.

“But in this case, not only did we need to move quickly, but we also needed to create diversity in order to create affordability.”

17

RobertsDay 01_introduction / 02_the next decade / 03_lessons from ellenbrook / 04_success formula / 05_beyond the crises

looking to the future_ beyond the crises Greener, cleaner, leaner: for smart operators intent on growth, the 21st century neighbourhood holds promise and opportunity, writes Stephen Moore, a RobertsDay principal.

The overlapping crises of climate change, peak oil, health and finance are not short-term trends but rather permanent issues establishing a ‘new normal’ for the development industry. It sounds like a paradox but these negatives can be switched to positives for both the development community and Australians at large.

Stephen Moore

18

Resource scarcity is one of the first issues prompting a wave of innovation. As power prices rise and water shortages intensify, so addressing clean energy in a development project will switch from an optional extra to a necessity. While homes with clean or green energy were seen at the start of the century to hold marginal appeal for buyers, they will quickly become a mainstream priority.

special report_mixing it

Another shift is that food production will circle back into local communities. Right now, the average plate of food travels 100 km to get to your table. In the future, neighbourhoods will be reequipped to grow their own food, be it on private garden allotments, community gardens or reinvigorated farmers markets.

Not only will it be healthier physically, it will provide ongoing mental health benefits and a far greater sense of community.

The next change is that sustainable transport within communities will become key. With petrol prices rising, we will move to a scenario where walking and cycling are simply the cheapest and most sustainable forms of transport. We will see streets planned as complete streets, ‘skinny streets’ that are about the pedestrian, the cyclist and the place rather than just the vehicle.

To succeed in the 21st century neighbourhood developers will need to harness the gamechanger that is green marketing.

To understand and cater to future buyers, developers with a green approach will have the competitive edge.

19

RobertsDay We’re passionate about place. Let’s talk about yours. Connect with us twitter.com/RobertsDay1 PERTH +61 8 9218 8700 SYDNEY +61 2 8202 8000 MELBOURNE +61 3 9645 0788

PERTH duane.cole@robertsday.com.au SYDNEY martine.white@robertsday.com.au MELBOURNE mike.Day@robertsday.com.au

And to read special reports and great places magazines, go to www.robertsday.com.au

w ww.linkedin.com/ company/robertsday

special report_mixing it

21