DELIVERING A VIBRANT CITY BUILDING BETTER COMMUNITIESACCOMMODATING GROWTH

UNLEASHING ADELAIDE’S POTENTIAL

Powerhouse CBD

PROPERTY COUNCIL OF AUSTRALIA – POWERHOUSE CBD: UNLOCKING ADELAIDE’S POTENTIAL

In October 2009 the Property Council released its blueprint for Adelaide’s Central Business District. Called ‘Adelaide2036: Building on Light’s Vision’ this document outlined a detailed plan for Adelaide to become a revitalised and vibrant city.

Some of the recommendations have been delivered and there are plans to progress many more. But we cannot rest on our laurels and simply hope for the community’s aspirations to transpire into action.

More and more voices are joining the chorus for a better city. This public policy paper seeks to crystallise the key issues that hold the City back from its potential and deliver transformational changes in our capital that delivers benefi ts for all South Australians.

This paper has been divided into two sections and supports the broader Adelaide2036 document. The sections are ‘Better People Places’ and ‘Unlocking our Potential’.

CREATING A VIBRANT CENTRAL CITY

Issues

Despite the canvas Colonel Light created for South Australia, in many parts our city remains a barren wasteland. We have Park Lands that people are afraid to use and a city that promotes cars ahead of people.

While there is great potential in this canvas, little real action is being taken to pull the CBD out of its late twentieth-century malaise. Our city should be beautiful AND vibrant - it can be both, and it must become that if we are to have any hope of attracting the best and brightest.

There is a long road ahead in the process of converting our city’s potential to reality. The city has been largely left to fend for itself in comparison with the development of the wider city; even in the Government’s 30-Year Plan for Greater Adelaide, the city receives only cursory mentions.

But hope is on the horizon with the Government’s eff orts to revitalise the Riverbank - Adelaide Oval Precinct, tangible eff orts to upgrade Victoria Square and Adelaide City Council’s pending trial of a laneway redevelopment.

But these only represent a couple of pieces in the whole jigsaw that is our city. What is urgently needed is a whole-of-city plan that scopes the growth of the city within the context of the 30-Year Plan for Greater Adelaide.

BETTER PEOPLE PLACES

Barriers

For many years the City has been devoid of any high-level strategic direction in the belief that, as the state’s pre-eminent economic and cultural hub, the CBD will look after itself. We have focused on metropolitan Adelaide to the detriment of our most valuable asset.

This has left us with a deteriorating city with no clear focus - it is no longer Adelaide’s premier retail hub; it isn’t yet the high-density Transit Oriented Development (TOD) it could be; but it still attracts the best of the state’s business community.

The greatest barrier to the creation of a meaningful plan for a strong and vibrant CBD is a City Council that is elected on a minority of residential voters, a constituency with little relativity to the interests of the 150,000-odd people who use the city on a daily basis.

Our city should be for every South Australian, however the Council’s focus is limited to residential issues arising from North Adelaide and the South-East corner.

This is demonstrated by how the Council allocates its limited budget - focusing heavily on residential issues - and in the Adelaide City Council Development Plan, which appears to place greater emphasis on preventing development than on growing and enhancing the best aspects of the city.

Recommendations

1. Develop a 30-Year Plan for the city, aligned to the 30-Year Plan for Greater Adelaide but specifi cally addressing issues aff ecting the CBD. The Plan should explicitly focus on creating people places throughout the city including in our underutilised Park Lands and laneways.

2. Incentivise the utilisation of Park Lands by implementing the Council’s Draft Masterplan for the Park Lands with a bolstered focus on concessions for appropriate development (recreational, tourism, cultural and educational uses).

3. Incentivise the activation of laneways by:investing in lighting, paving and street • furniture;providing subsidies for building owners to • construct new lane-facing tenancies within existing buildings;subsidising the establishment and • operation of lane-facing businesses via a rate holiday; relaxing liquor licensing laws to make it • easier to open small-scale “hole in the wall” wine-bar outlets; andrelax dry zone regulations in line with • liquor licensing laws.

4. Introduce incentives to enable the adaptive reuse of heritage buildings (see the Property Council’s Heritage Policy).

5. Determine funding streams for CBD amenity and infrastructure including:

Mandate a minimum proportion of • commercial rates/development levies to be re-invested in the CBD;State Government to commit funding • towards issues within the CBD that are of state signifi cance; andDevelop methods of introducing private • funding to infrastructure projects such as PPP instruments.

PROPERTY COUNCIL OF AUSTRALIA – POWERHOUSE CBD: UNLOCKING ADELAIDE’S POTENTIAL

Issues

Investment in new CBD buildings slowed drastically throughout 2010, across all investment classes. While access to fi nance and competition from the eastern seaboard have been factors in this decline, the City is also losing its primacy as a place to live, work, invest and develop to the suburbs.

As the 30-Year Plan for Greater Adelaide is rolled out, the range and quality of suburban locations amenable to higher density development will expand. The State Government is investing in suburban transit infrastructure, undertaking major suburban TOD projects and changing zoning to facilitate infi ll uplift along the Park Lands fringe.

In this context, the City is now being forced to compete for a share of development and investment that it once took for granted. It must off er a clearly-positioned mix of development products that are distinct from their suburban counterparts. And supply-side constraints must be removed if we are to stop the City losing out to the suburbs.

The CBD can and should be Adelaide’s fi rst, largest and best TOD. Adelaide must off er a fi nely-honed and competitive business environment, ready access to a large skilled workforce and superior infrastructure and amenity if it is to return to its position of pre-eminence.

UNLOCKING OUR POTENTIAL

Barriers

Current City planning policies are out of step with the vision for a vibrant future City. We need a more global approach that eliminates confl icting agendas and prejudices.

It has now been fi ve years since the City’s zoning was last comprehensively reviewed, and much has changed in that time. The release of the 30-Year Plan for Greater Adelaide in February 2010 underscored the potential for zoning to be used as powerful tool for achieving the highest and best use of land in the City, and the key to eliminating burdensome land use restrictions. However, the complex layering of planning rules over many years has resulted in a maze of bureaucratic obstacles to development. Key issues include:

restrictive height limits in many • sought-after locations;a “quantity over quality” approach to • heritage listing of properties in the central City area - with Council seeking to list more;restrictive policies that constrain • development of heritage-listed sites and those adjacent to them (e.g. by imposing height restrictions on heritage-adjacent sites);apartment design policies that constrain • options for high density developments; inequitable and uneconomic open space • requirements; andunnecessary built form restrictions that • reduce the potential yield of City sites.

If these issues are left unaddressed they will continue to force investment into the suburbs at the expense of the City. And they will act as yet another obstacle companies considering a move to Adelaide.

But good planning rules will not be enough on their own.

Market interventions are needed to consolidate fragmented development parcels and release them to the market, to incentivise development that will activate Adelaide’s laneways and to attract businesses to relocate to the City.

GETTING THE BALANCE RIGHT

PROPERTY COUNCIL OF AUSTRALIA – POWERHOUSE CBD: UNLOCKING ADELAIDE’S POTENTIAL

Recommendations

The Property Council recommends the following key actions:

The State Government must designate the City as a Zone of State 1. Signifi cance and take responsibility for planning and development assessment.

Lift height limits in areas where there is (or could reasonably be expected 2. to be) demand for high-density residential development:

along West/South/East Terraces; • around Hurtle and Whitmore Squares;• along Morphett and Pulteney Streets (south);• across the northwest corner of the City (to capitalise on the new • hospital and medical research institute precinct);along Greenhill Road, Fullarton Road and Dequetteville Terrace (to • create opportunities for Park Lands-facing apartment living); within the expanded Mixed Use Zone (to the southwest and • southeast of the existing zone boundary).

Amend the current planning rules applying to heritage and heritage-3. adjacent sites to promote their redevelopment while preserving street-visible heritage fabric by means such as:

removing onerous “retention depth” requirements;• removing height restrictions for heritage-adjacent sites; and• promoting innovative design treatments that will allow development • yields to be maximised while protecting heritage fabric.

Remove unnecessary planning controls that act as barriers to the City’s 4. competitiveness, including:

setback angles in core CBD areas (which currently require unfeasibly • small fl oorplates at upper levels and prevent the City competing with large fl oorplate development proposals in suburban areas);minimum unit sizes for student housing and serviced apartments;• glazing and enclosure of road-facing balconies; and• obstacles to community-titling apartment buildings to allow • individual ownership of (and hence investment in) residential units.

Introduce a site consolidation program to buy up non-conforming or 5. obsolete buildings and/or underutilised small holdings and amalgamate these to form more versatile, development-ready parcels.

Create programs that encourage interstate and international companies 6. to move into the City, such as concessions on cost imposts such as stamp duty, land tax and rates.

Exempt City developments from Open Space Contribution requirements 7. in recognition of housing and lifestyle expectations in the City and ready access to existing public spaces.

Expedite a City tram loop that connects key squares, residential locations 8. and business and retail precincts to encourage regeneration of underutilised spaces and exploit lifted height restrictions (as per Recommendation 2).

UNLOCKING OUR DEVELOPMENT POTENTIALNext Steps

Immediately designate the City as a Zone of State 1. Signifi cance and initiate a Development Plan Amendment (DPA) to remove barriers to development and lift development potential (i.e. to address actions 1, 2 and 3).

Charge the Minister with auspicing powers for 2. this DPA and provide for it to be overseen by a Reference Group comprising the Property Council, the Integrated Design Commission and Adelaide City Council. A fi xed timeframe of nine months should be set for its completion.

Charge Land Management Corporation with 3. commencing the Site Consolidation Program (recommended action 4) on behalf of the Capital City Committee no later than January 2011. Costs should be shared by Council and the State Government.

Provide seed capital for the fi rst tranche of land 4. purchases, after which the Program should be self-funding (including provision of interest payments on seed funding and borrowings).

Form a Reference Group from representatives of 5. the Property Council, the Capital City Committee and the Integrated Design Commission to oversee the implementation of the new Laneways Incentives Program and Business Relocation Incentives Program (recommended actions 5 and 6), to commence no later than January 2011 and funded from a hypothecated share of inner City commercial rates revenue.

Resolve policy misalignments (such as liquor 6. licensing and open space issues) that present obstacles to implementation of these recommendations.

Benefi ts

These actions will remove supply-side barriers to investment, place the City on a competitive footing with suburban TOD locations and empower the market to act where currently it cannot. They will provide a competitive regulatory environment supported by market-catalysing program interventions.

The City cannot expect the market to pay an excessive premium – in cost, time and convenience – for investing in the City relative to suburban locations. Barriers to investing in the City should be no greater than those applying in suburban (or interstate) locations.

The recommended actions will also send a powerful message to the development sector that the City is open for business and keen to compete for inbound investment. This will provide forward momentum at a critical period in the economic cycle, which could have a cascading eff ect.

Investor confi dence is key to the economic future of the City. Freeing up planning controls and providing incentives for achieving desired development forms will boost investor confi dence.

By contrast, Adelaide City Council’s current drive to list additional heritage buildings will do exactly the opposite. Layering additional development limitations onto the already constrained core of the City tells investors that the City is a place where growth and development are not welcome.

By aligning planning controls with market drivers and by intervening to incentivise the market to act where it otherwise would not, additional development potential can be unleashed to re-energise the City.

PROPERTY COUNCIL OF AUSTRALIA – POWERHOUSE CBD: UNLOCKING ADELAIDE’S POTENTIAL

142 Gawler Place

Adelaide SA 5000

Telephone: 08 8236 0900

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Email: sa@propertyoz.com.au

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Property Council of Australia Limited

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