[+] ‘Half Pregnant’ Masterplanned Communities Need More Density

Getting the mix right will be crucial for addressing the nation’s growing housing shortage, but out in the greenfields, densification is a slow burn. But the reality is that as affordability issues bite and lot sizes shrink, a house on a 280sq m block is not necessarily a good outcome, Saunders Havill director Michael Forwood says. “We are half pregnant in our greenfield communities,” Forwood says. “We need to jump over that half-pregnant density into doing terraces, and there’s really good examples of that on the Sunshine Coast. But we need to bring more volume in, and I think that’s a learning for us over the next five years. “I think it’s actually the role of masterplanned communities to stretch those provisions of councils, to stretch those planners beyond what they’re necessarily comfortable with.” Volume developers can push innovation Speaking at the Suburban Futures conference this month, Forwood advocated for increased density in masterplanned communities where large-scale developers can lean into innovation. “We’re talking about large scale developers with volume, we can pick a product, we can move product forward and actually get the volume that delivers the cost discounting that comes with volume,” he says. “We just need to push forward that little bit further … I think there’s space for innovation. “The affordability piece is [impacting]. We cut up land, 450sq m blocks used to be the norm, we’re now moving those down to 375sq m, it’s the sort of product people want. “But affordability is taking that down to 250sq m and we are seeing problems with that product, because a 10m frontage with a 28m deep block with a single-storey building is a really rubbish product.” ▲ Metro Property Development has begun building 90 townhouses at Rochedale in Brisbane. Masterplanned communities and fast-growing regions are home to about 20 per cent of Australia’s population and are at the coalface when it comes to boosting housing supply. “Greenfield communities are vilified, they’re the things that are expensive, they’re sending councils broke … it’s just not true,” Forwood says. “These are vital areas that are really quality estates. I think in two generations’ time we’ll look back and think ‘yeah we did that pretty well’.” But as a development play, masterplanned communities have not been around for that long. Communities stalwart Bruce Harper began his career in one of the earliest masterplanned communities, Golden Grove in South Australia. Now at the helm of Avid Property Group, Harper says up until the 1980s it was just cutting up land and a “lick of tar”. But Harper says the Golden Grove estate was a benchmark for innovation in the development of masterplanned communities. “Local government and state governments have really codified masterplanned communities now and created pages and pages of development control … it’s stifled the innovation,” Harper says. “We are regulating ourselves away from innovation.” Density will rise in communities Density is on its way in masterplanned communities, according to Harper. “I think in the future we will probably continue to increase densities. We will look at things like high vertical living that’s really in the CBDs and surrounding back into our suburban areas. We’ll develop our parks more because the public realm has become the backyards that have disappeared from smaller housing. “We’ll also look at much more mixed use town centres and activity centres because they will become halfway houses for work from home, because we’re social people. “I think we’re moving towards what I would call resort designs of our suburban areas. We’re seeing that through the landlease communities. That’s the pointer of where we are heading.” Avid Property Group currently has a portfolio of 45 projects in Queensland, Victoria and NSW and has to date targeted buyers under 50, but this looks likely to change with the addition of eight Living Gems landlease communities it has acquired. Legacy of right-sizing communities Masterplanned communities are a long-term play, which Harper describes as “building a legacy”, something Springfield City Group chief executive Raynuha Sinnathamby can attest to. Australia’s biggest masterplanned community, Springfield celebrated its 30th birthday last year. The land was originally purchased for $7.9 million and acquired in 1991 by Maha Sinnathamby and Bob Sharpless. Now it is home to 55,000 residents across 2860ha, in single homes, townhouses and apartments, which Sinnathamby says addresses different price points and housing demands. “I think one of the things we wouldn’t change is we had a vision and we stuck to it, and it’s very hard for a long term project to do that through things like the GFC and Covid and construction cost escalations,” Raynuha Sinnathamby said. ▲ Earlier this year Springfield City Group put a 12.7ha development site on the block to “inject a new wave of activity”. “If I had to pick one thing I would change, you just want to put an accelerator button on the whole thing. “Really it should be much shorter times to get approvals, given the housing crisis and everything we’re going through at the moment. Giving the license to councils and developers to just get on and get started, I think that would give developers a whole lot of flexibility.” According to recent data from RPM the average lot size in masterplanned communities is now 350sq m as the cost of vacant land and build prices continues to escalate. “Households are looking at their budget and saying what am I going to give up on, am I giving up on the extra bedroom and extra living space? Or am I going to give up on a bit of land? And that’s really where the market has shifted,” RPM group manager for research and data Michael Staedler says. You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

[+] ‘Half Pregnant’ Masterplanned Communities Need More Density

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