Following the introduction of interim height and built form controls on the Hoddle Grid and Southbank in September 20151, the Minister for Planning has this week announced the proposed permanent controls in the form of Planning Scheme Amendment C270 (Click here for Amendment documentation and background reports). The Amendment is on exhibition and open for public submissions until 30 May 2016.  A panel hearing will then be held in the week commencing 11 July 2016.  Partner Meg Lee and Lawyer Zina Teoh report on the key aspects of the Amendment and what has changed from the interim controls.

Background

The interim controls brought in by Amendment C262 in September 2015 for a 12 month period included:  

  • mandatory controls to limit overshadowing to identified public spaces, including the Shrine of Remembrance, Federation Square and the State Library Forecourt;
  • wind analysis requirements for planning applications;
  • a change from discretionary height controls to mandatory height controls;
  • a 24:1 site plot ratio for much of the CBD area; and
  • applied mandatory podium height and setback requirements in other areas.

At the time the Minister brought in the interim controls by way of an 'overnight' amendment, he proposed that permanent controls would be part of a public planning scheme amendment process commencing in April 2016.  And the Minister has delivered on time in the last days of April.

The Amendment documentation is comprehensive and is supported by reports by experts, including by Hodyl & Co, Hayball and SGS Economics, on Economic Impact Assessment, Architectural Testing, Site Feasibility, Comparative Controls, Daylight Modelling, Wind Assessment and Overshadowing.

Where does the Amendment apply?

The Amendment applies to the area in the following Map, namely the Hoddle Grid and Southbank areas on land that is zoned Capital City Zone Schedules 1, 2 and 3, Public Use Zone Schedules 1, 2, 4 and 7, Road Zone, Public Park and Recreation Zone, Mixed Use Zone and General Residential Zone and is also within the Design and Development Overlay Schedules 2, 7, 40, 60 and 62 of the Melbourne Planning Scheme.

The amendment introduces two types of development areas:  

  • General Development Areas - where the emphasis is on growth and more intensive development and is primarily a location where towers are supported; and
  • Special Character Areas - where the emphasis is to protect specific valued attributes, including a relatively lower built form scale appropriate for each area.

For Special Character Areas:   

  • where a mandatory height control was in place prior to the introduction of the interim controls, the mandatory height controls are proposed to remain.
  • where a discretionary height control was in place prior to the introduction of the interim controls, the discretionary height controls remain, but with the introduction of an associated floor area ratio to guide the discretion that can be exercised in relation to overall height.   

The Special Character Areas are shown on the Map below extracted from the Hodyl & Co background report to the Amendment on Special Character Areas.  They include key civic spaces such as the Victorian Parliament, Town Hall and the State Library; cultural institutions, including; the Arts Centre, Hamer Hall, Recital Centre, the National Gallery of Victoria and Australian Centre for Contemporary Art, and the shopping district, Bourke Street Mall and the surrounding streets. They also incorporate natural places such as the Yarra riverfront.

Map 1: Built Form Control Area

Click here to view image.

Map 2: Special Character Area Map

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*To view larger scale image click onto picture.

What does the Amendment do?

The amendment introduces new built form provisions through a combination of amendments to various local policy, zone and overlay provisions including:   

  • introducing floor area ratio of 18:1 and uplift requirements where there is a delivery of associated public benefit(s), by amendments to Schedules 1, 2 and 3 to the Capital City Zone;
  • changing existing height control provisions to a mix of mandatory and discretionary height limits. Pre-existing mandatory height controls remain, however, discretionary height controls now include an associated discretionary floor area ratio and setback controls through amendments to the Design and Development Overlay Schedules 2 (Height Controls - Capital City Zone), 40 (River Environs), 60 (Southbank) and 62 (Bourke Hill). These schedules now include permit and application requirements related to overshadowing and wind impacts;
  • introducing street wall height, setbacks (to the street and to neighbouring boundaries), tower separation, overshadowing and wind impact requirements through replacement of the Design and Development Overlay Schedule 10 (DDO10);
  • updating the local policy framework urban design and sunlight to public spaces provisions for consistency with the DDO changes through amendments to existing Clauses 22.01 (Urban Design within the Capital City Zone) and 22.02 (Sunlight to Public Spaces); and
  • introducing a new Clause 22.03 (Floor Area Ratio and Delivery of Public Benefits) to provide policy support for the public benefit(s) sought in the schedules to the Capital City Zone;

What has changed from the Interim Controls? 

  • Strengthened shadowing and wind controls

Shadowing and wind controls were limited under the interim provisions and have been strengthened under the proposed amendments. The proposed amendments have introduced additional spaces to be protected from overshadowing and extended the dates and times of protection. The Interim wind controls were focused on ensuring that an undesirable level of wind exposure would be avoided. The proposed wind controls are different in that they include a measure for wind safety and provisions to ensure comfortable wind conditions for 80% of the time, rather than just protecting against extreme conditions.

  • Tower set backs 

Mandatory tower setback requirements were introduced to the interim controls under DDO10. These have been amended under the proposed controls to provide fixed tower setbacks requirements with defined flexibility. The controls are now as follows:   

  • A minimum street setback of 5m for towers above the street wall
  • Minimum side and rear setbacks of 5m for buildings up to 80m in height
  • Side and rear setbacks of 6% of the overall height of the tower if the height of the tower is above 80m
  • Minimum setback between towers within the same site of 6% of the total combined height   
  • Floor area ratio and uplift

The interim controls introduced the floor area ratio maximum of 24:1 unless certain requirements had been met. This ratio represented a midpoint between recent approvals in Melbourne and international site plot ratio averages. This ratio has now been reduced to 18:1, after architectural testing in two case study areas in Hoddle Grid and Southbank which assessed the range of floor area ratios which could meet the built form objectives for the sites.2  While the proposed floor area ratio is lower than the interim controls, there is a potential for an uplift above the maximum ratio if the all the relevant built form controls have been met and an appropriate public benefit has been provided. 

The floor area ratio is calculated by comparing the site area with the floor space within a building. This means that a site with an area of 1000m2 would be allowed to have a tower with floor space of 18,000m2 where the maximum floor area ratio is 18:1. Therefore a tower built across the whole of the site could be allowed to have 18 floors, or if it were built across half the site, a total of 36 floors. 

The following picture shows how the proposed floor area ratio and uplift provisions compares to limits in New York and Sydney.  

Click here to view image.3

The proposed controls introduce the option of going above the 18:1 floor area ratio in sites where all the built form provisions are met and an appropriate public benefit can be shown. This means that developers are able to increase the density of a site in exchange for contributing to community infrastructure.  The increase in floor area above the 18:1 ratio is called the Floor Area Uplift. 

For a Floor Area Uplift to be allowed, a public benefit must be provided. The public benefit must be listed within a category in the Public Benefits Schedule. Some examples of public benefits are social housing within a proposed building and plazas or laneways directly accessible from the public street or public area. 

The value of a public benefit must be determined by a responsible authority in accordance with the Public Benefits Schedule. The value of the Public Benefit is then compared with the value of the Floor Area Uplift. The Floor Area Uplift is calculated in accordance with the Floor Area uplift Calculation Schedule, which is measured as 10% of the gross realisation value per square metre (GRV/m2) for all additional floor area above the 18:1 ratio. The GRV/m2 of a floor depends on the proposed use of the floor and the precinct which it sits in. Table 1 below demonstrates the GRV/m2 for proposed uses in the relevant precincts. 

For an uplift to be allowed, the value of the Public Benefit must be equal or greater to the value of the Floor Area Uplift. Public Benefits must be delivered to the satisfaction of the responsible authority prior to the development being occupied. 

Click here to view image.5

*To view larger scale image click onto picture

Reactions and Next Steps

While official media positions have not been released by the UDIA or the Property Council, executives from both bodies have been quoted6 as critical of the proposed height and plot ratio controls expressing concern that it will depress property values by limiting the options available for development and that it will discourage investment.  The supporting economic impact assessment report by SGS Economics accepts that there will be an adjustment period for current property owners who have purchased land under a different regime, but concludes that arguably, the introduction of the interim controls has already alerted the market to the changed trading conditions. Any shock effect may well have been substantially absorbed by the market already. In this regard it is noted that the Transitional Provisions in the Overlays only exclude applications lodged prior to the commencement of Amendment C262, not Amendment C270. Obviously this will be an issue that owners and developers will be likely to raise in submissions to the Amendment and will be considered by the Panel.  

Unlike the interim controls which were introduced without public consultation, the Amendment is now on public exhibition and open for submissions until 30 May 2016.  A panel hearing will then be held in the week commencing 11 July 2016 to consider the public submissions and then to report to the Minister on the final form of the controls.