The state government is adamant Sydney’s business district can accommodate more intensive residential development, putting it on a collision course with the city council which warns it won’t be a silver bullet for tackling the housing crisis.
The issue has sparked an exchange between the premier and lord mayor, with Chris Minns saying he would attempt to “give peace a chance” and work with Clover Moore or otherwise use the state’s planning powers to overrule her.
Sydney Lord Mayor Clover Moore.Credit: Steven Siewert
“The NSW government has the laws and regulations in place on the books already to make changes,” Minns told 2GB on Friday. “In the first instance, we’re going to give peace a chance and try and work our way through this but, if not, I’ve got obligations, as does the Prime Minister to house people.”
Minns put his case for transforming Sydney’s financial district with more homes to help revive the city centre, arguing the government “would not close the door on that as a potential source of future housing”, when he spoke to a room full of property developers this week.
“We’ll get there,” Minns said on Friday. “I’m not going to announce the policy changes today but I’m clearly signalling that it makes eminent sense to have more residential development close to the city, added to which it will add a 24-hour economy to an area that’s really only vibrant during business hours.”
Moore said she was “always open to these discussions with the Premier”. However, she said there were “significant challenges” to converting offices buildings to residential use because “plumbing, ventilation and access to sunlight [were] expensive hurdles”.
NSW Premier Chris Minns wants more residential housing in the city.Credit: Dion Georgopoulos
“Large, open floor plates allow enough natural light in an office setting, but once you start putting walls you may discover most of your rooms have no window.”
She said apartments in the city centre were generally at the higher end of the property market, “so this isn’t going to be the silver bullet for addressing the housing crisis”.
“We have to ensure that the CBD balances all needs, including our desire for a bustling 24-hour economy and sufficient employment floor space.”
Minns had said the City of Sydney “has had a real aversion to residential development in the heart of the CBD, with a preference for commercial”.
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“I think that needs to be looked at, to be honest, and the reason for that is that you are seeing a cyclical change to people’s work habits that I’m not sure will bounce back as quickly as many CBD businesses want,” Minns told an event organised by the Property Council of Australia this week.
Moore said the council’s planning controls did not prevent residential development in the city’s core, which was home to 30,000 people with another 4000 homes approved or under construction.
Minns’ remarks underscore debate about turning empty and underused office blocks into homes following the pandemic – a move that has been met with fierce resistance from some mayors.
Minns argued that city centres were less vibrant when commercial buildings dominated, and that increasing the amount of residential development close to the central business district was “certainly the way Manhattan grows, and [other] major metropolitan [areas] around the world”.
The Labor government is pushing for thousands of desperately needed new homes to be built close to the city centre, particularly around train lines, as opposed to the city’s fast-growing outskirts.
“Why wouldn’t we be [building more homes] closer to the CBD where we have existing infrastructure, where we have good public transport links, and where people can ride bikes and walk, rather than taking up the space on a highway?”
A City of Sydney spokesperson said the council’s Central Sydney Planning Strategy incentivised commercial floor space without prohibiting residences as Sydney was “a global city for commerce”.
Waverley Council’s Labor mayor Paula Masselos said the area’s commercial core was under growing pressure from residential developments. She opposed more homes being built in the centre of Bondi Junction, and said the reduction of commercial space threatened the council’s “regional centre” status, which required it to retain a minimum of 10,000 jobs in return for funding and benefits.
“The conversion of already fully tenanted commercial buildings, to even taller residential towers, may well have a significant and germane impact upon this status,” Masselos said.
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North Sydney Mayor Zoe Baker is protesting against a plan to turn the prominent MLC Building on Miller Street into 340 build-to-rent apartments, arguing it would be “the death knell for our CBD”.
Planning Institute of Australia policy director John Brockhoff said there was a “clear tension” between preserving the vital economic role of CBDs, while also creating active, liveable places.
“As with anything with planning, it’s a trade-off.”
Brockhoff said incorporating more dwellings in commercial centres should stem from solid research and good strategic planning, rather than an ad hoc approach that enabled them to “seep” into an area. He said planning authorities were required to anticipate long-term needs, and it would be very difficult to recreate a financial district once sites were transformed with apartments.
“It would seem a ‘no regrets’ pathway to keep at least some parts of the CBD as commercial core.”
Brockhoff also agreed converting office blocks into suitable residential buildings was “a bit messy”.
“If you have a view that it’s a magical solution to the housing crisis, in most cases it’s going to be a really complicated process because the buildings aren’t designed for it. Don’t assume that converting these buildings is going to be cheap, easy, quick or give you a product that’s affordable.”
