Pro-Density Activity Centres Open Doors for Developers

Victoria is in the midst of a housing crisis, with a significant shortage of affordable homes in desirable areas. The rising housing demand has outpaced supply, making homeownership and affordable rent out of reach for many. 

In response, the Victorian Government seeks to create 800,000 homes in the next decade by promoting higher-density urban development in Metropolitan Melbourne. 

One of the Government’s initiatives is the announcement of the Activity Centre Program (ACP) and new planning controls targeting 10 pilot Activity Centres, namely:

• Broadmeadows

• Camberwell Junction

• Chadstone

• Epping

• Frankston

• Moorabbin

• Niddrie (Keilor Road)

• North Essendon

• Preston (High Street) and

• Ringwood.

Overarchingly, there are two key planning control changes that are driving this change:

1. The Walkable Catchment Zone (WCZ). This new zone is intended to apply within 800m from the Activity Centre cores, noting that a number of these areas are within established residential zones. It will potentially allow for increased development, notionally up to six storeys; and

2. The Built Form Overlay (BFO). A new overlay for Activity Centre cores, structured with defined ‘outcomes’ and ‘standards in a deemed-to-comply format and incorporating a new value capture framework. The BFO is expected to replace existing built-form controls, although details are presently imprecise.

More recently, in late October, the Premier announced an additional 50 Activity Centres (see Map 1 below), and many new Activity Centres, which will be subject to further planning controls.

These include allowing 10-20 storey developments near train stations, with details to be progressively developed through 2025 and 2026.

▲ Map 1. ‘More Homes More Opportunity’, Premier of Victoria, October 2024.

For land developers, consultants, and prospective residents, these evolving planning controls present exciting and challenging opportunities.

The new controls aim to streamline the planning approval process by potentially exempting certain developments from public notice requirements during an application stage and removing third-party appeal rights to the Victorian Civil and Administrative Tribunal (VCAT).

Complementary changes to ResCode (residential development provisions) are also proposed, potentially reducing design standards as they relate to siting of buildings and including boundary setbacks, overlooking and overshadowing requirements.

However, the proposal has faced opposition from local councils and the community more broadly.

Concerns include potential adverse impacts on neighbourhood character, lack of community infrastructure and potential windfall gains tax implications for existing landowners. 

Despite these concerns, the mandate to create more housing around Activity Centres and transport corridors is well documented and has strong strategic support as outlined in the Victoria Planning Provisions (VPPs). 

These comprehensive planning reforms represent a significant shift in urban development strategy, aiming to address Victoria’s housing crisis by enabling more dense, accessible and potentially affordable housing options near transport hubs in existing and new Activity Centres.

The multi-disciplinary team at Planning & Property Partners continues to closely monitor these planning control changes, anticipating the new opportunities that will shape future development in Victoria.

If you have land in one of the stated Activity Centres or are interested to know more about the reforms please do not hesitate to contact us.

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