dairy road innovation precinct analysis summary … · - large scale land areas (comparable to...

DAIRY ROAD INNOVATION PRECINCT ANALYSIS – SUMMARY REPORT

Prepared for

OCTOBER 2019 Molonglo Group

20190379 - Summary report - 191014

© SGS Economics and Planning Pty Ltd 2019

This report has been prepared for Molonglo Group. SGS Economics and Planning has taken all due care in the preparation of this report. However, SGS and its associated consultants are not liable to any person or entity for any damage or loss that has occurred, or may occur, in relation to that person or entity taking or not taking action in respect of any representation, statement, opinion or advice referred to herein.

SGS Economics and Planning Pty Ltd ACN 007 437 729 www.sgsep.com.au Offices in Canberra, Hobart, Melbourne, Sydney

Dairy Road Innovation Precinct Analysis – Summary Report i

DAIRY ROAD INNOVATION PRECINCT ANALYSIS

This report provides a summary of the analysis undertaken to inform the Molonglo Group’s proposed land use mix for the development of the Dairy Road precinct.

Success factors for innovation precincts

Innovation precincts have been conceptualised in several different ways. For example, Katz and Wagner (2014) categorise innovation precincts into three models: anchor plus, reimagined urban area, and urbanised science park.

Under this classification, Dairy Road could be considered a ‘reimagined urban area,’ which often occur in industrial settings/warehouse districts undergoing physical and economic transformation. In these settings, change is powered in part by transit access, historic building stock, proximity to downtowns in high rent cities, and the presence of advanced research institutions and anchor companies.

Success factors for the creation of innovation precincts have similarly been conceptualised in different ways. Often they include factors such as quality of place, diversity and inclusion, affordability, critical mass, infrastructure, accessibility, anchor institutions, competitive advantage, and collaboration (refer left). The intent of the Dairy Road precinct is that these success factors will be addressed, as outlined in the Concept Master Plan and supplementary information.

Overarching these success factors are governance arrangements that nurture the precinct’s vision and its long-term economic development objectives.

Case study identification

SGS has used 2016 Census data to identify concentrations of innovation jobs in Australia’s three largest cities (Sydney, Melbourne and Brisbane) as case studies for Dairy Road. Areas within 1 to 5 kilometres of the CBD have been considered. This analysis has been undertaken at the Destination Zone (DZN) ABS geography; the smallest geography available for actual employment data by industry group.

Innovation jobs were defined as employment in the 1-digit ANZSIC categories of: Manufacturing; Accommodation and Food Services; Information, Media and Telecommunications; Professional, Scientific and Technical Services; and Public

Source: Victorian Department of Environment, Land, Water and Planning, 2018.

Dairy Road Innovation Precinct Analysis – Summary Report ii

Administration (in DZNs with fewer than 3,000 jobs in this final category, to exclude areas with large public service employment pools, as this is not envisioned for Dairy Road).

Case studies were then selected using this data, refined to include areas that are former industrial land uses transitioning to mixed uses, not designated town centres, and areas without major institutional anchors (such as universities or hospitals).

Comparison of precincts and alternate scenarios

The chart below compares the total jobs to population ratio for each of the identified case study precincts. The figures used for Dairy Road have been based on the proposed employment and population for the site as reflected in previous Planning Reports, together with the existing employment for Fyshwick.

Under the envisaged development scenario, the wider Dairy Road/Fyshwick precinct has a comparable total jobs to population ratio to precincts such as Fortitude Valley and Collingwood. In terms of innovation jobs, the ratio is also similar to these precincts, as well as other precincts such as Milton and Pyrmont.

The Dairy Road site’s 14-hectare site on its own is not comparable to the identified case study benchmarks, however the 467-hectare area including Fyshwick far exceeds them. It is possible to think of the site as a concentrated node in a wider precinct, where the critical mass of employment and amenity afforded by residential and mixed use development combine. The case study benchmarks generally have a minimum of 10,000 jobs and a population of 4,000. Below this level, critical mass and amenity may not be achieved.

Implications and key findings

Innovation precincts can help Canberra respond to ongoing change in the urban and economic environments. Dairy Road could evolve into a ‘reimagined urban area’ given its proximity to the CBD, affordable building stock, and the market interest of private services businesses.

Mixed use development that integrates commercial and residential uses will aid this evolution, given the need for quality of place, critical mass, diversity and inclusion, and affordable premises, to make innovation precincts successful.

Benchmarking Dairy Road and Fyshwick to comparable innovation and creative precincts in Australian cities suggests that a total jobs to population ratio of between 1:0.2 and 1:0.6 should be envisaged. Molonglo Group’s proposal of 1:0.3 for the Dairy Road precinct therefore seems reasonable and achievable.

Source: ABS Census, 2016.

Contact us

CANBERRA Level 2, 28-36 Ainslie Place Canberra ACT 2601 +61 2 6257 4525 [email protected]

HOBART PO Box 123 Franklin TAS 7113 +61 421 372 940 [email protected]

MELBOURNE Level 14, 222 Exhibition St Melbourne VIC 3000 +61 3 8616 0331 [email protected]

SYDNEY 209/50 Holt St Surry Hills NSW 2010 +61 2 8307 0121 [email protected]

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Dairy Road Innovation Precinct Analysis


© SGS Economics and Planning Pty Ltd 2019

This report has been prepared for Molonglo Group. SGS Economics and Planning has taken all due care in the preparation of this report. However, SGS and its associated consultants are not liable to any person or entity for any damage or loss that has occurred, or may occur, in relation to that person or entity taking or not taking action in respect of any representation, statement, opinion or advice referred to herein.

SGS Economics and Planning Pty Ltd ACN 007 437 729 www.sgsep.com.au Offices in Canberra, Hobart, Melbourne, Sydney


ACT strategic context

Innovation Precinct Analysis


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▪ The 2018 ACT Planning Strategy includes a vision to be a sustainable, competitive, and equitable city that respects Canberra as a city in the landscape and the national capital, while being responsive to the future and resilient to change. The five overarching strategic directions are:

- Compact and Efficient City

- Diverse Canberra

- Sustainable and Resilient Territory

- Liveable Canberra, and

- Accessible Canberra.

▪ Under the Compact and Efficient theme, the aim is for urban sprawl to be limited, with growth catered through increasing density in appropriate locations, and a target for 70 per cent of development and urban intensification to occur within the existing urban footprint.

▪ The theme of Diverse Canberra also recognises the need to diversify the economy, while building on competitive advantages in knowledge and service based sectors.

▪ The ACT Housing Strategy reinforces the theme of Liveable Canberra, seeking to foster a housing market that meets the needs of the community. Among the goals of the strategy is to have an equitable, diverse and sustainable supply of housing for the ACT community.

▪ The Housing Strategy recognises that with continued growth in Canberra’s population, delivering housing in effective locations is of utmost importance.

Strategic context

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Success factors for innovation

precincts



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▪ Innovation precincts have been conceptualised in several ways. For example, Katz and Wagner (2014) categorise innovation precincts into three models:

- Anchor plus model: usually in the downtowns & midtowns of central cities. Large scale mixed use development is centred around major anchor institutions and a rich base of related firms, entrepreneurs and spin off companies, involved in the commercialisation of innovation .

- Reimagined urban area: often occur in industrial settings/warehouse districts undergoing physical and economic transformation. Change is powered in part by transit access, historic building stock, proximity to downtowns in high rent cities, supplemented by advanced research institutions and anchor companies.

- Urbanised science park: commonly found in suburban or ex-urban areas. Sprawling areas of innovation are urbanisedthrough an increase in density and an infusion of new activity.

▪ In this classification, Dairy Road could be identified as a ‘reimagined urban area.’

▪ There is no single global definition of the ‘creative economy’ –it differs from place to place and from culture to culture.

▪ The dynamics that drive success in developing creative industries vary from one place to another. Success in building creative industries in particular locations, whether driven by public policy or private investment, generally comes from looking at that location’s “capabilities, not its needs”. UNESCO 2013 Report on the Global Creative Economy

Conceptualising innovation precincts

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1. Quality of Place: Vibrant, amenable and walkable physical environment often through mixed-use and dense development.

2. Diversity and inclusion: Is the precinct a diverse and inclusive place that provides broad opportunities?

3. Affordability: Does the precinct provide a diversity of affordable premises?

4. Critical mass of related enterprises to promote activity and vibrancy which will assist in creating an amenable environment.

5. Does the precinct have the necessary ICT infrastructure and utilities to accommodate a critical mass? A well connected digital environment will attract technology firms and enable highly efficient global communications.

6. Highly accessible location is important for attracting workers. Businesses will not locate in precincts if they cannot attract workers to that location.

7. Credible and reputable anchor enterprises or institutions that are present, relevant to and engaged with industry. It is important they operate in industries relevant to the precinct to promote engagement.

8. Competitive advantage: Is the precinct leveraging and aligning its distinctive assets to grow firms and jobs in the district, city and region?

9. An open and democratic operating environment that promotes a mindset for collaboration. Collaboration will not occur spontaneously; it is a long-curated process. Shared or collaborative spaces such as conference facilities and meeting rooms can facilitate collaborative interactions.

▪ Overarching these factors of success are governance arrangements that nurture the precinct’s vision and its long-term economic development objectives.

Success factors for innovation precincts

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Case study identification



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▪ SGS has used 2016 Census data to identify concentrations of innovation jobs in Australia’s three largest cities (Sydney, Melbourne and Brisbane) as case studies for Dairy Road. Areas within 1-5 kilometres of the CBD have been considered.

▪ This analysis has been undertaken at the Destination Zone (DZN) ABS geography – the smallest geography available for employment data.

▪ Innovation jobs have been defined as employment in the following categories:- Manufacturing

- Accommodation and Food Services

- Information, Media and Telecommunications

- Professional, Scientific and Technical Services, and

- Public Administration (only in DZNs with fewer than 3,000 public admin jobs).

▪ The selection of case study precincts from this data has been based on criteria including:- Former industrial land uses, transitioning to mixed uses

- Large scale land areas (comparable to Fyshwick)

- Not designated town centres

- Areas without institutional anchors (e.g. universities, hospitals).

▪ The maps on the following slides illustrate the number of innovation jobs in each city, and relevant data including:- Land area

- Total number of jobs

- Innovation jobs as a proportion of total jobs

- Jobs to population ratio, and

- Innovation jobs to population ratio.

▪ The Dairy Road site is shown at the same scale for comparison.

Method

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Sydney

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Pyrmont precinct- 57 ha land area- 15,711 jobs- 8,445 innovation jobs (54%)- Jobs to population ratio: 1:0.4- Innovation jobs to population ratio: 1:0.67

Surry Hills/Redfern precinct- 73 ha land area- 17,755 jobs- 8,861 innovation jobs (50%)- Jobs to population ratio: 1:0.5- Innovation jobs to population ratio: 1:1.04

Dairy Road and Fyshwick- 467 ha land area- 4,200 population- 2,400 dwellings- 13,378 jobs- Jobs to population ratio: 1:0.3


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▪ Pyrmont precinct

▪ Pyrmont was originally made up of wharfs, warehouses and a sugar refinery (CSR). The Building Better Cities Program and creation of the City West Development Corporation instigated an urban renewal plan to develop the area as a mixed use community. By 2004, Pyrmont had around 13,000 residents and around 22,000 employees.

▪ Surry Hills/Redfern precinct

▪ The precinct had its origins as ‘slums,’ with some terrace development retained, then as a cluster for clothing manufacturing. Gentrification of the precinct began in the late 1960s to early 1970s. The area’s transformation has seen growth in the creative industries replace employment in manufacturing, which has also been accompanied by support industries such as cafes, restaurants and bars. Today it is well recognised as a creative industry cluster.

Sydney

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Innovation precinct success factor In this precinct

Quality of place ✓

Affordability ✓

Critical mass ✓✓

Well connected/infrastructure ✓✓

Highly accessible ✓

Anchor enterprises/institutions ✓


Quality of place ✓✓✓

Affordability ✓



Highly accessible ✓✓✓



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Melbourne

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Richmond/South Yarra precinct- 114 ha land area- 15,716 jobs- 6,560 innovation jobs (42%)- Jobs to population ratio: 0.55- Innovation jobs to population ratio: 1:1.31

Collingwood precinct- 26 ha land area - 3,112 jobs- 1,170 innovation jobs (38%)- Jobs to population ratio: 1:0.27- Innovation jobs to population ratio: 1:0.73

South Melbourne precinct- 70 ha land area- 11,273 jobs- 4,881 innovation jobs (43%)- Jobs to population ratio: 1:0.05- Innovation jobs to population ratio: 1:0.12



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▪ Collingwood precinct

▪ One of Melbourne’s oldest suburbs, Collingwood developed as a working class area for much of its history. It has seen significant urban change and population increase since 2000 with new housing stock. Recent developments have seen some apartment projects incorporate adaptive reuse of industrial sites.

▪ South Melbourne precinct

▪ South Melbourne is an inner suburb, around 2 kilometres from the CBD. The area has seen gentrification, with many terrace homes restored and renovated.

▪ Richmond (South Yarra) precinct

▪ Mid-20th century Richmond was home to many factories (tanneries, breweries, granaries, piano, match, jam and sauce factories). The population declined significantly by 1991 to just under 23,000. Gentrification followed, with families couples buying previously run-own cottages. Warehouse conversions today are returning the area to wider residential uses. Bridge Road has become the factory seconds shopping capital of Australia.

Melbourne

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Affordability ✓✓

Critical mass ✓


Highly accessible ✓✓



Quality of place ✓✓

Affordability ✓







Affordability ✓

Critical mass ✓





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Brisbane

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Milton precinct- 92 ha land area- 7,844 jobs- 2,817 innovation jobs (36%)- Jobs to population ratio: 1:0.2- Innovation jobs to population ratio: 1:0.61

West End precinct- 99 ha land area- 6,511 jobs- 2,378 innovation jobs (37%)- Jobs to population ratio: 1:0.68- Innovation jobs to population ratio: 1:1.85

Fortitude Valley precinct- 100 ha land area- 19,373 jobs- 9,956 innovation jobs (51%)- Jobs to population ratio: 1:0.3- Innovation jobs to population ratio: 1:0.56

South Brisbane precinct- 99 ha land area- 10,355 jobs- 3,933 innovation jobs (38%)- Jobs to population ratio: 1:044- Innovation jobs to population ratio: 1:1.17



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▪ Milton precinct

▪ Located 2km west of CBD, Milton includes a mix of light industry, warehouses, commercial offices, and retail, and single and multiple occupancy residences.

▪ South Brisbane

▪ Within the inner city, former industrial area included sawmills and steam joinery. Today it is seeing urban renewal, cultural infrastructure and is proximate to universities.

▪ West End precinct

▪ Former industrial development included West End Gas Works. Seeing increased redevelopment with population serving and entertainment uses.

▪ Fortitude Valley precinct

▪ In the 1950s-60s this was the largest non-CBD shopping area in Australia. Suburban shopping centres and closure of the tram saw the area decline. More recently it has been a homefor start ups and creative industries, and is one of the fastest growing suburbs in Brisbane.

Brisbane

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Innovation precinct success factor

In this precinct


Affordability ✓




Anchor enterprises/institutions ✓✓


In this precinct


Affordability ✓




Anchor enterprises/institutions ✓✓✓


In this precinct



Critical mass ✓✓✓


Highly accessible ✓✓✓



In this precinct








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▪ The chart to the right compares the population to total jobs ratios and population to innovation jobs ratios for each of the identified precincts.

▪ Under the envisaged development scenario, Dairy Road/Fyshwick has a comparable total jobs to population ratio as precincts such as Fortitude Valley and Collingwood.

▪ The innovation jobs to population ratio is also like these precincts, as well as Milton and Pyrmont.

▪ The Dairy Road site’s 14 ha is not comparable to benchmarks, however the 467 ha including Fyshwick far exceeds them. Need to think of the site as a concentrated node in a wider precinct, where the critical mass of employment and amenity afforded by residential/ mixed use development combine.

▪ The benchmarks generally have a minimum of 10,000 jobs and a population of 4,000. Below this critical mass and amenity may not be achieved.

Comparison of precincts

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Total jobs to population

Innovation jobs to population


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Case study and scenario comparison

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Precinct Population Total jobs Total jobs to population ratio

South Melbourne 589 11,273 0.05

Collingwood 853 3,112 0.27

Richmond/South Yarra 8,614 15,716 0.55

Milton 1,727 7,844 0.22

South Brisbane 4,603 10,355 0.44

West End 4,410 6,511 0.68

Fortitude Valley 5,590 19,373 0.29

Pyrmont 5,638 15,711 0.36

Surry Hills 9,215 17,755 0.52

EPSDD Alternate Scenarios

Existing situation 0 650 0.00

Scenario 1 (Innovation Park) incl. Fyshwick 0 12,938 0.00

Scenario 2 (Low-service/ onsite res) inc.Fyshwick

1,040 11,838 0.09

Scenario 3 (med scale) incl. Fyshwick 2,075 12,388 0.17

Scenario 4 (high res) incl. Fyshwick 3,060 12,388 0.25

Scenario 5 (Dairy Rd) incl. Fyshwick 4,200 13,738 0.31


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SCENARIO 1 (Innovation Park)

▪ Population - 0

▪ Jobs - 2,000

▪ Population to jobs ratio – 0

PROS

▪ Doesn’t compete with other centres

CONS

▪ Not effectively utilising available space

▪ Doesn’t meet strategic planning objectives for a more compact and efficient city, with a diverse economy.

SCENARIO 2 (Low-Service/ onsite res)

▪ Population – 1,040

▪ Jobs – 900

▪ Population to jobs ratio – 1:1.2

PROS

▪ Resident population with access to local jobs

▪ Increases vitality

CONS

▪ Not a significant increase in jobs from existing situation

▪ Doesn’t provide quality of place, diversity and inclusion

SCENARIO 3 (Medium scale)


▪ Jobs – 1,450


PROS

▪ Provides for a mix of uses

CONS

▪ Limits jobs and population but without clear basis

SCENARIO 4 (High res)


▪ Jobs – 1,450


PROS

▪ Increases critical mass

▪ Provides for a mix of uses

CONS

▪ Limits jobs and population but without clear basis

Alternate Scenarios

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Under this scenario


Critical mass ✓




Under this scenario


Critical mass ✓




Under this scenario


Critical mass ✓




Under this scenario


Critical mass ✓✓✓




Broader policy context



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▪ Strategies and planning provisions in other states focused on inner to mid city precincts have arisen due to a growing concern in these areas that the ongoing conversion of industrial areas to residential or mixed use places is displacing currently employment land uses

City of Sydney Employment Lands Strategy

▪ Developed to guide growth and change to 2030 in the employment lands in the City of Sydney LGA

Commercial Zone 3 (Victoria)

▪ The intent of the Commercial 3 Zone is to:

- Foster a diversity and critical mass of employment generating uses

- Provide affordable floorspace for such uses, and

- Limit the displacement of employment generating uses from productive areas.

▪ The zone prioritises uses that form part of the emerging economy, particularly industrial, commercial/office and supporting services.

Policy context

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▪ Innovation precincts can help Canberra respond to ongoing change in the urban and economic environments

▪ Dairy Road could evolve into a ‘reimagined urban area’ given its proximity to the CBD, affordable building stock, and the market interest of private services businesses.

▪ Mixed use development that integrates commercial and residential uses will aid this evolution, given the need for:

- Quality of place

- Critical mass

- Diversity and inclusion

- Affordable premises

▪ Benchmarking of comparable innovation/ creative precincts in Brisbane, Sydney & Melbourne suggests that a total jobs to population ratio of between 1:0.2 and 1:0.6 should be envisaged.

▪ Molonglo Group’s proposal of 1:1.03 for Dairy Road seems reasonable and achievable.


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AppendixInnovation Precinct Analysis


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Sydney

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Sydney

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Melbourne

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Melbourne

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Brisbane

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Brisbane

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Canberra

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▪ The same data has been mapped for the ACT for comparison.

▪ Note: DZNs with fewer than 1,000 total jobs have been excluded.


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Canberra

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CanberraP: +61 2 6257 4525E: [email protected]

HobartP: +61 3 6264 3116E: [email protected]

MelbourneP: +61 3 8616 0331E: [email protected]

SydneyP: +61 2 8307 0121E: [email protected]

dairy road innovation precinct analysis summary … · - large scale land areas (comparable to...

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