[+] ‘Uneconomic’: Parramatta’s Future Under a Cloud

Developers and industry stakeholders are optimistically looking to NSW planning minister Anthony Roberts to resolve the fracas over commercial height limits and floor space ratios in the Parramatta CBD as the Local Environment Plan inches towards finalisation. The council and developers were shocked when the Department of Planning and Environment accepted the City of Parramatta’s CBD Planning Proposal in May, while rejecting its proposed height limits and floor space ratios (FSR). Commercial tower heights were knocked down from 60 storeys to 52 storeys, and mixed-use residential projects from 75 to 69 storeys. The council had proposed unlimited FSR for sites with a footprint greater than 1800sq m but the planning department rejected that proposal and maintained 10:1 limits. The plan will expand the boundaries of the CBD but North Parramatta and a block in Phillip Street were excluded from changes to controls by the department over concerns about heritage values and public amenity. A City of Parramatta submission on the issue was debated at the council's meeting on Monday, July 11, and will be discussed again at its meeting on July 25. That submission is calling for the department to produce a State Environmental Planning Policy allowing unlimited FSR in the commercial core and another allowing higher, albeit limited, FSR in the surrounding mixed-use zone. The SEPP process would not require another round of public consultation and could be completed in time to take effect on October 14, when the controls are due to come into place. The council is also calling for the department to provide $500,000 for a study into the urban design, heritage, and economic analysis of North Parramatta, with a precinct plan to follow. ▲ Vision unrealised: Developers and the council believe the proposed amendments will strangle development in the Parramatta CBD. The recommendations were endorsed by the Property Council of Australia, and Business Western Sydney. Disruptions ‘blocking progress’ The disruptions have halted several projects in advanced stages of planning and threaten Parramatta’s status as a hub for development and its role as the second CBD of Sydney, according to developers. Urban Taskforce chief executive Tom Forrest says the DPE modifications will stymie plans from government, tenants, residents and workers to develop Parramatta into a thriving CBD. “What's concerning is that there's a demand from large commercial players—banks, public service agencies and the like—for large floor plates,” he says “If it's really going to be the second CBD of Sydney, as is the desire of just about everyone, I don't think it's sensible to be placing limits.” Supporting infrastructure intended to enable a denser CBD and greater daytime population, including the Sydney Metro and Light Rail, is under construction. The NSW budget handed down late last month committed $600 million to Stage 2 of the Light Rail, due to open in 2023. But questions remain over how much office space Parramatta will be able to provide. Roberts hailed the plans approval in May, saying, “The finalisation of these plans are the culmination of work with Parramatta City Council to unlock more than 11,000 new homes and almost 16,000 new jobs in the CBD”. However, the council’s initial proposal was intended to deliver up to 15,000 new dwellings and support more than 59,000 new jobs. ▲ The city’s mayor says ‘the future of the CBD hinges on getting these plans right’. Parramatta Lord Mayor Donna Davis said that “over the past decade, the council has worked tirelessly with the NSW government, community, landowners and developers to create a blueprint for development that acknowledges the specific needs of our unique city”. “The future of our CBD hinges on getting these plans right, so we won’t rest until our vision for the city is realised.” ‘Finalisation’ not quite finalised Rather than modifying plans or simply upping stakes for more accommodating precincts, developers are placing their hopes in Roberts to unwind the restrictions before the plan is finalised. Forrest told The Urban Developer that a relaxation of limits on towers is "not an expectation but certainly a strong hope". “And we are calling for the minister to review whether it's sensible for the second CBD of Sydney to be placing limits on the height of commercial buildings. We're calling for the government to step in.” St John's Anglican Cathedral, which has launched a 100-year masterplan including a new plaza, a commercial tower, and a residential tower, has spoken out against the planning department modifications. Reverend Canon Bruce Morrison of the Anglican Church told The Urban Developer that “the recent Parramatta CBD planning instrument released by NSW Planning is a very serious threat to the viability of our project and a range of other major projects”. However, Morrison said, “We have had positive discussions at a ministerial level, and we are hopeful of a resolution”. At 43 and 45 storeys, the proposed St. John's towers already sit under the modified height limit but are affected by the floor space restrictions. ▲ St John’s Anglican Cathedral has launched a 100-year masterplan for its Parramatta CBD site. “Ultimately, if no resolution is reached, investor confidence will be severely shaken, which in turn will undermine the government's broader planning objectives for Sydney,” Morrison said. “The current economic outlook has enough headwinds; investors need stability and an effective planning regime should deliver that stability.” Design process upended Developers say that projects progressed under existing design processes have received indicative approval for years. The CBD Planning Proposal has been in development since 2013, with many stakeholders working to its parameters while state government agencies signalled approval. Morrison said that the St John’s proposal “has been formally supported by Parramatta councillors twice as well as the Department of Planning during the extended approvals process”. “We are committed to Parramatta and want to invest in the city but the proposed planning instrument simply renders our proposal uneconomic. “This is not what we want, after so many years of working closely with Parramatta Council and Department of Planning, not to mention substantial expenditure getting the proposal this far.” Developers argue that the existing design and review process is sophisticated and stringent enough to deliver amenable precincts, without the rigid limitations that DPE has mandated. Forrest argues that the government should “let those architectural design processes sort out what is sensible, rather than just placing arbitrary FSR limits”. The use of Site-Specific Planning Proposals may allow increased densities on a project-by-project basis but produces a riskier planning environment. Planning Minister Anthony Roberts is on leave and was unavailable for comment. The Department of Planning and Environment and City of Parramatta Council were contacted for comment. You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

[+] ‘Uneconomic’: Parramatta’s Future Under a Cloud

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