Melbourne Developers Hit Back at Mayor’s ‘Lazy Landlord’ Plans

Melbourne’s property industry has hit back at Lord Mayor Nick Reece’s plan to crack down on vacant and derelict buildings, with developers rejecting accusations of laziness and pointing to policy failures as the root cause. The City of Melbourne unanimously voted at its September 2025 Future Melbourne Committee meeting to explore stronger enforcement measures against property owners, including differential rates, special charges and expanded demolition powers. “We’re putting lazy landlords on notice. We’re exploring new powers so that if you don’t clean up your act, we’ll do it for you,” Reece says. “I’m fed up with eyesores which are targets for graffiti, dumping and anti-social behaviour. It’s disrespectful to our community.” Reece suggested temporary activations, including pop-up parks, food truck hubs or community markets, could prevent vandalism and bring life to vacant sites. The council is investigating special rates under existing state legislation and considering whether derelict sites could be converted into interim green spaces, with officers to report back at the end of November. Developer reaction has been swift and critical. Samuel Property managing director Illan Samuel calls the suggestion “ridiculous and out of touch”. Stonebank senior development manager Simon Hicks says the council needs to be clear about what are two separate issues. “One being unmanaged, unsafe or derelict sites and the other being vacant or empty sites remaining undeveloped,” Hicks tells The Urban Developer . “I think the council needs to be very measured here. I agree vacant or undeveloped sites need to be appropriately maintained, both for safety as well as presentation. “But if council is considering applying differential rates, levies or charges to encourage development this could certainly backfire. Adding more cost to the sites is not the answer and is counterproductive.” ▲ Simon Hicks, Illan Samuel and Dominic Cerantonio. Cera Stribley managing principal Dom Cerantonio is particularly critical of a state-imposed four-storey mandatory height control for the Carlton precinct that has made development unfeasible. “The site had a rejected development application for an eight or nine-storey building. Then the owner had a contract ready to go but the state put a four-storey height limit on that site,” Cerantonio tells The Urban Developer . “Now, it’s not in the best interest of the owners to sell or develop themselves. Why would they?” Cerantonio questions the planning control’s logic. “That particular site ( pictured below ) is just on the south side of the gardens. There’s no way it overshadows anything,” he says. “The fact that they just applied that height restriction is ludicrous. The left hand needs to be talking to the right to try and encourage development, because if you don’t, it doesn’t happen.” He suggests the council should lobby the State Government to increase heights or incentivise development in areas where such limits are imposed. “Or maybe one condition of facilitating more development might be that owners have to activate sites in the short term,” Cerantonio says. “You’re not going to encourage development if it makes more sense to sit there and do nothing.” Managing director of Salta Properties Sam Tarascio, which has about $400 million in unbuilt permits, rejects the notion that developers benefit from delays. “Every delay creates enormous financial pressure, so it’s never in the developer’s interest to sit on a site unnecessarily,” Tarascio tells The Urban Developer . “The reality is that since Covid, cost escalations, planning delays and rising interest rates have made it harder than ever to bring projects to life in Victoria.” Charter Keck Cramer national executive director Richard Temlett says building costs have increased 30 to 50 per cent since Covid, adding hundreds of thousands of dollars to projects. Delete Hicks says, “With property prices having stagnated, demand for office going down and construction costs considerably having increased, coupled with the high amount of state and local taxes and levies, feasibilities are genuinely under pressure. “I don’t believe developers are leaving good sites undeveloped for no reason. If a project economically stacks up, it would proceed.” Tarascio, too, rejects the idea that holding land is strategic. “If you’re holding land, you don’t necessarily want to sell it. What’s the point of selling the land only to buy something back later? “We’ve already incurred the loss. We’ll ride it out. Long term, the fundamentals are sound. It’s not easy because you’re paying holding costs and you’ve got teams of people waiting to get out of the gates.” The council has identified more than a dozen problem sites across the central business district. The former Cancer Council building at 1-23 Rathdowne Street, Carlton, owned by Chinese richlister Wang Hua with an asking price of $62 million, has become a focal point of community frustration. The building has sat boarded up and has been home to squatters for more than a decade. Samuel describes the site as a “great piece of dirt, literally opposite Carlton Gardens and the exhibition centre, and on the cusp of the CBD”. “You’ve got incredible views over the gardens and, absolutely, people would want to live there,” he says. “You could create great product. We’ve already got towers just on the periphery of the CBD, but at four levels, it’s never going to be feasible.” City of Melbourne records show 71 projects with planning permits have yet to begin construction, representing 90 buildings and about 17,500 apartments. Problem sites in or near the CBD include V-Leader’s 600 Lonsdale Street, vacant since 2022 after demolition for a $574-million office project that stalled; Singaporean billionaire Michael Kim’s 25-35 Power Street in Southbank, where applications have been rejected since 2013; and Malaysian developer SP Setia’s former AFP building at 383 La Trobe Street, a proposed 72-storey tower with apartments selling for 2028 completion. Sites on the City of Melbourne hitlist include: 600 Collins Street, Melbourne 185-195 Queensberry Street 46-78 Bouverie Street, Carlton (former C.U.B site) 400 William Street, Melbourne 12 Riverside Quay, Southbank 383 La Trobe Street, Melbourne (former AFP) 25-35 Power Street, Southbank 248-254 King Street, Melbourne 600 Lonsdale Street, Melbourne 366-422 Abbotsford Street (cnr Molesworth Street), North Melbourne 1-23 Rathdowne Street, Carlton 56-58 60-62 Clarendon Street, Southbank 570-576 Little Bourke Street (cnr King Street), Melbourne The council has power under local law to take “whatever action it considers necessary” if landlords fail to address compliance notices. The November report will assess whether current provisions, including a maximum fine of $1,017.15 for unsafe or unsightly properties, provide adequate enforcement tools. Hicks questions the proposed interventions. “Ordering demolition seems an overreach unless there are unrepairable safety concerns,” he says. “Conversion to public space at landowner’s expense purely because the site is vacant seems unreasonable. It also provides arguments against development in future as locals or councillors claim lack of public open space.” There’s a lot of frustration going around town. Australian Property Development Association president Alex Huang says Victoria is “probably one of the worst places that a developer can pick to launch a project”. Tarascio says state taxes are “basically a big ‘Don’t come to Victoria’ sign for developers.” Samuel described the council’s approach as “so nonsensical it would be more at home in an episode of Utopia ”, referring to the ABC satire about the difficult process of taking grand, uncosted, inadequately planned, fundamentally flawed schemes. “It’s more clickbait from a politician without any understanding as to the why and how from people who actually work in the industry.”

Melbourne Developers Hit Back at Mayor’s ‘Lazy Landlord’ Plans

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