[+] NSW Expands Tool Box as Housing Delivery Times Get Supercharged

The New South Wales government’s attempts to fast-track developments have been met with cautious optimism by the property industry. In the past month, the NSW government has announced the implementation of development pattern books and the end of design competitions for high-rise developments in key areas—last week it launched plans to fast-track a greater diversity of homes on brownfield land. Affordable housing developer Nightingale has been focused on the Victorian market but launched in Sydney with its build-to-rent project in Marrickville . Nightingale chief executive Dan McKenna says that any move forward is positive. “It seems a moment in time when the state and federal governments are starting to realise the need for speed; to get going and get moving, and the NSW government is leading that charge with things like the pattern book plans,” McKenna says. Encouragement for new players NSW Building Commissioner David Chandler says the aim of the Built It NSW initiative, which is overseeing pattern book creation, is to support continued quality accountability as housing is fast-tracked. “The fact is, we need between 50 and 100 new players—builders and developers—to come into the market,” Chandler told The Urban Developer. “We have these grand conversations with mature and big businesses, but those Tier 1 contractors are only about 15 to 20 per cent of the players in the market. “As we bring new players in, we need to set them up for success, not let them fail at the bottom because that will erode the foundations of all the work we’ve done.” ▲ Between 119,400 to 138,550 new homes will be built in Greater Sydney during the next five years but there’s a limit to how far developers can expand outwards. Chandler suggests that the class of small and medium developers and builders will move from Class 1 to Class 2 building work, which tends towards smaller apartments. “I’m 100 per cent behind that push to build up but we have a lot of work to do to enable the migration of players into that Class 2 space.” One of these methods is the recently announced pattern books. Balancing quality and cost “What developers and builders are finding is that they are challenged to produce a level of high-quality, declared construction designs before they start,” Chandler says. “The development application [DA] sets the context, the envelope, the scale, the urban fit—all of that is resolved in the design pattern book, [so the next step is populating] those envelopes with ready-to-go details; the layout of apartments, lift shafts, bathroom configuration and so on. “What we’re proposing to do is to create a library with maybe 40, 60 or more standard layouts so there is a palette of designs to drag into the approved DA.” ▲ Construction and layout designs will be made freely accessible on a new platform for designers and developers. “We want to take these entrants into our market and give them tools they can quickly apply and set them up for success, not failure,” Chandler says. “Insurers and financiers will look at the product and say, ‘Isn’t it good you’re not making it up every time’, because they are using repeated designs.” Chandler hopes that this will also help alleviate cost issues facing developers that have made housing, especially affordable homes, unfeasible in some areas of the state . “We’ll put in the library the things that give the developers and builders a choice, which is different to the way a real estate agent might push them. “Those agents might say, you have to have marble benchtops and three bathrooms. An additional bathroom can cost between $45,000 and $70,000, which adds up to drive the cost through the roof. “That creates aspirational housing, not housing for workers or the starting-out buyer or the trade-down buyer. “We’ve been overly focused on the aspirational and we’ve been negligent in creating stock that allows people to enter the market or move down. “This will help projects to become more affordable but they do not need to be of lesser quality.” ▲ The Inner West Council has agreed to waive the $1.2-million discretionary developer contribution for Nightingale and Fresh Hope’s Marrickville project. McKenna says that pattern books can scare people. “But it doesn’t preclude good design, high-quality housing and good outcomes; it’s just a replication of those things rather than starting from scratch every time. “Like everyone in the industry we are really focusing on construction price escalations and what it does to our projects going forward. “It’s now about replication and efficiency, we’re not necessarily reinventing the wheel from a design and construction sense, it’s about scale and speed. “It’s still going to be a case-by-case basis but if we can do something in four rather than 14 months then let’s do that.” Mid rise on the up Property consultant Charter Keck Cramer says that mid-rise development is “essential” and that 34 per cent of the 156,000 apartments currently approved were medium density. “The medium-density stuff, the so-called ‘missing middle’, is a good development. It’s a housing typology that’s quite popular and there should be a lot more of it,” University of Sydney senior lecturer in urbanism Dr Laurence Troy says. The NSW government clearly has the same sentiment, having introduced rules to allow apartment buildings between three and six storeys, terraces, townhouses and smaller one-totwo-storey apartment blocks in suburbs where they are not currently allowed. Property Council NSW executive director Katie Stevenson welcomed the news, particularly the removal of the need for design competitions. “Unfortunately, site-by-site design competitions have added substantial delays to the planning system and it’s good to see that the government is retaining a commitment to design excellence while moving to a more efficient model,” she says. ▲ The rule changes allow mid-rise apartment blocks near transport hubs and town centres in R3 medium-density zones and appropriate employment zones. Design Excellence Competitions have proven both a boon and a bane for the NSW property sector, according to Fender Katsalidis partner Rob Mirams. “The Design Excellence Competition process, while intended to identify and elevate exceptional design proposals, can also be a resource-intensive approach,” he says. “The direct appointment of highly qualified architects, in collaboration with councils and design panels, offers a more efficient and cost-effective path to achieving exceptional design outcomes. “By streamlining the design selection process, we could redirect resources toward critical initiatives such as affordable housing, transportation networks, schools, and hospitals.” “In Victoria, our guidelines are certainly less prescriptive than NSW,” Fender Katsalidis partner James Pearce says. “On one hand, this allows for more freedom and creativity in the design interpretation, but on the other hand, discretionary controls also lend themselves to more uncertainty and the potential for longer timeframes.” Another piece of the puzzle Of course, cutting down planning and design times is just one piece of the puzzle, and the Building Commissioner says that a fundamental reassessment of how the construction and development industries operate is required. “It has been so long since builders have gone back and rethought the process of construction, and reflected on where the leakages of cost and time are,” Chandler says. “[Part of the problem is that] the way we go about building buildings is not organised well. You can improve your profitability by improving your productivity. “Every time you bring a new player on to the site you need an overhead for this person. Let’s go the other way and reconsolidate trade packages into elemental packages and start to reduce the number of businesses that need to come on to the site?” ▲ The reforms create capacity for industry to deliver up to an estimated 112,000 new homes, 30 per cent of NSW’s Housing Accord target. While the NSW government is making moves to help the process, there are more systemic challenges to fast-tracking development. “The planning process is not the biggest issue,” Troy says. “Development consent only occupies around 7 per cent of the total timeline of a development. “Before the DA you have to sell the units before the banks will offer the financing, and that takes time, and that has little to do with the planning system. “Developers will rarely build 500 units in one go and the banks don’t want them to do that and flood the market so they stage the output, and control the release and again—that’s not about planning. “We can’t force the banks to fund things inherently risky but making the whole supply system inherently less risky would be a step in the right direction.” You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

[+] NSW Expands Tool Box as Housing Delivery Times Get Supercharged

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