$1bn Social and Affordable Housing Fund announced

The NSW Government has unveiled the first details of its 'one billion dollar social and affordable housing fund' (SAHF), at an industry briefing on 11 December 2015. 

According to David de Carvalho, Deputy Secretary - Strategic Reform and Policy at the Department of Family and Community Services, monies from the fund will be used to bridge a funding gap in proposed new social and affordable housing developments, to make such projects commercially viable. Project consortia including at least one Tier 1 or Tier 2 community housing provider may apply for funding. Mr. de Carvalho provided that the fund will deliver "at least 3000" social and affordable housing dwellings - and anticipated further funding if this "initial stage" is successful. 

Community housing providers are the principal beneficiaries of the SAHF

To be eligible for funding, a proposed development must provide a minimum of new social housing dwellings - 500 for metro or mixed metro and regional developments, and 200 for regional developments. In this context, 'new dwellings' can mean either newly constructed or newly available as social housing. Richard Mills, Project Director at the NSW Treasury, said the Government has no preference for metro or regional proposals. Furthermore, at least 70% of the total number of dwellings must be social or affordable housing. The Government anticipates that community housing providers involved will hold unencumbered title to social and affordable housing residences funded under the scheme.

Both Mr. de Carvalho and Mr. Mills emphasised that projects delivering a mix of social, affordable, and private market dwellings over multiple locations would be preferred. Mr. de Carvalho said projects would "ideally" be located close to employment, services, and public transport. Both also stressed a preference for projects built on unused or under-utilised land already owned by the applicant housing provider/s. Mr. Mills agreed with a suggestion from a briefing attendee that consortia need not apply if a proposed development does not satisfy this preference. 

It is important that not all funding for successful applications will go towards construction of dwellings. Funding will be provided for the community housing providers' tenancy and asset management services. Social service providers are also expected to form part of applicant consortia. This is because funding will also go to what the briefing presentation called "Tailored Support Coordination" - that is, services that support the deemed needs of resident social housing tenants. According to Mr. de Carvalho, such supports will ideally facilitate increased educational and employment prospects, and ultimately a transition out of social housing. Mr. Mills emphasised that this funding will provide for the "coordination" of social services - that is, linking them and monitoring activities - but not the client support activities themselves. Indeed, project funding will be provided over a period of 25 years, as opposed to a lump sum. 

The briefing presentation provided the following timeline for the initiative:

"14 December 2015 - Registration process [for interested participants] opens;
Late January 2016 - Release of Invitation for expressions of interest;
March 2016 - Deadline for submissions of expressions of interest;
May 2016 - Announcement of shortlisted Applicants;
May 2016 - Release of requests for proposal;
May-July 2016 - Interactive process;
July 2016 - Deadline for submission of proposals;
August 2016 - Announcement of preferred proponents;
September 2016 - Service agreements awarded."

The SAHF was initially promised by the Liberal-National Party coalition prior to the 2015 NSW election. The substantive policy announced on 11 December was developed in conjunction with the NSW Council of Social Services (NCOSS), with reference to a Memorandum of Understanding, and infrastructure think tank IPA. 

Premier Mike Baird is expected to make another announcement concerning the fund in early 2016. The full industry briefing is available here, and the accompanying presentation here. 

Our response

NSW is experiencing a renting affordability crisis. Approximately 60,000 people are currently on the waiting list for social housing in NSW. The wait time for a majority of dwellings - particularly larger houses, and almost all properties in Sydney - is at least five years, and often more than a decade. Moreover, due to the preference given to 'priority' applicants in allocating available properties, an offer of social housing for many non-priority applicants will most likely never arrive.

The Tenants' Union strongly supports the expansion of the state's social and affordable housing stock in NSW as a central measure to address this crisis. Accordingly, we are supportive of the basic objective of the SAHF to provide 3000 new social and affordable dwellings. However, we also agree with the closing comments provided by Acting NCOSS CEO John Mikelsons at the industry briefing, that "tomorrow, even with this fund, we will still have a housing affordability crisis in NSW". An additional 3000 dwellings represents a commendable first step rather than anything close to a solution. Mr. Mikelsons also identified the need for inclusionary zoning and tax reform to adequately address this issue. Here, too, we broadly concur, though would add that reform to tenancy laws is also important. 

Our response to the finer details of the scheme is also mixed. We support the requirement that funded projects consist of at least 70% social and affordable housing. This provides an appropriate focus, and should serve as an important safeguard against use of the initiative as a de facto subsidy for private market developments. Moreover, the benefits to tenants of housing close to transport, employment, and education facilities are self-evident - though this does not appear to be a strict requirement for funding. 

The preference for developments on 'unused or under-utilised' land already owned by applicant housing providers should provide for efficient use of Government funds, and hopefully the delivery of as many new residences as possible. We are somewhat concerned, however, by the possibility that low-density community housing may be considered 'under-utilised'. This would raised the prospect of painful eviction and relocation for existing tenants. 

But the requirement that funded projects include "Tailored Support Coordination" seems to signal the continuation of a worrying trend in social housing in NSW. It assumes an intrinsic and necessary connection between poverty and social support. The successful 'Housing First' initiative negates such a presumption. The expectation on efforts to 'transition' to the structurally insecure and unaffordable private market is also cruel and unrealistic for most. Finally, such an approach further entrenches housing as a privilege to be earned and lost, as opposed to a basic need and a human right. 

Major redevelopment of Waterloo

The NSW government has announced an extensive redevelopment of the inner city suburb of Waterloo. According to The Sydney Morning Herald, a total of 10,000 new dwellings, accommodating 30,000 new residents, will be built over a period of 20 years. The project will be centred around a new railway station - part of the 'Sydney Metro' line that will link southwest Sydney through to Bankstown with northwest Sydney through to Rouse Hill. It will form part of the wider 'Communities Plus' project. 

Matavai and Turanga towers, Waterloo

The Herald story states that new dwellings will initially be built on a State-owned, 13 hectare site, held principally by NSW Land and Housing Corporation. The final redevelopment will cover 40 hectares. According to The Daily Telegraph, the 30-storey Turanga and Matavai towers on Phillip Street, and surrounding, lower-density public housing apartments, will be demolished as part of the redevelopment. This will require the relocation of approximately 2000 public housing tenants over the life of the project.

The Government has said that one third of the 10,000 new dwellings will be social and affordable housing, with the remainder for the private market. Premier Mike Baird told the Herald that there will be no loss in the number of social housing dwellings in the suburb from current numbers. The Premier did not speak on whether the social housing dwellings built to replace current stock will also contain the same number of bedrooms. 

On the subject of relocations, the Premier said, "Every single [affected] tenant will have the right to come back". This comment was echoed by Social Housing Minister Brad Hazzard. A letter sent to public housing tenants in Waterloo from the Minister, dated 16 December 2015, states, "I want to assure you that tenants who live at Waterloo can remain in Waterloo after the redevelopment. While some tenants may need to relocate on an interim basis into other housing in the local area, many will be able to move directly into the new social housing as the site is redeveloped."

The Telegraph states that relocations from public housing blocks marked for demolition are expected to commence in 2017, with construction to begin in 2018. 

According to a Transport for NSW statement, the precise location of the centrepiece railway station has not yet been determined. The station is not due to open until 2036. 

Our concerns

On the information available, the Waterloo redevelopment appears to be of substantially similar form to the Macquarie Park UAP, the smaller 'Communities Plus' developments, and the development on Cowper Street, Glebe. All involve the demolition of tenanted public housing blocks for larger mixed residential apartments, and thus the relocation of many households. 

Relocations are inherently painful experiences for those affected. FACS claims its staff are experienced in assisting tenants through relocation processes, having learnt much from earlier renewal projects. But testimonial from places such as Millers Point, Claymore, and Bonnyrigg give a different perspective. Independent research into the impact of relocation - and what specifically helped long-term tenants adjust to new homes, neighbourhoods and communities - should be commissioned and considered before proceeding with any projects involving the renewal or disposal of currently tenanted stock. We support the Minister's claim that tenants will be able to remain in the Waterloo area and believe it is important that this is adhered to. In this regard, we believe it is important that FACS formalises clear policies and processes concerning management of relocations. This did not happen in the aforementioned relocations. 

The stated timeframe for the project is also extremely tight; the Government intends to commence construction in just over two years. This is concerning as it indicates that tenants may be compelled to relocate to unsuitable properties to facilitate construction.

Finally, given this development will be incorporated into the Communities Plus program, we also maintain the same concerns regarding loss of independence for social housing tenants as for other Communities Plus sites. Concepts such as 'mutual obligation', and burdensome tenancy management, further enmesh social housing tenants in the welfare system. Support services should of course be available to social housing tenants - not least in a period of relocations - but not mandated as a condition of tenure. Furthermore, the expectation that tenants eligible for social housing should promptly resolve their need for assistance and exit into an expensive and insecure private rental market is both unrealistic and cruel. 

New details about Communities Plus

New details have emerged regarding the NSW Government's residential development project, Communities Plus.

Locations

Previously, the Department of Family and Community Services had announced that seven locations would be utilised, but had only disclosed the precise location of the Macquarie Park site. The Communities Plus website now includes details of the locations of the other sites: Gosford, Liverpool, Newcastle, Seven Hills, Telopea, & Tweed Heads.

Communities Plus site in Gosford, from Google Maps

The Gosford site is a 4500m² block at 209-309 Mann Street, adjacent the Pacific Highway and close to Gosford station. Google Maps suggests it is a disused commercial property - consisting mostly of a closed down hardware store and its parking area. 

The 'Liverpool' site is actually a 1700m² block at 4-6 Bigge Street in neighbouring Warwick Farm, close to the Hume Highway. Google Maps suggests it is currently a vacant lot. It was previously the site of single-storey one bedroom and studio apartments. 

The 'Newcastle' site is actually a 2800m² block at the corner of Lake Road and Main Road, Glendale - part of the Lake Macquarie LGA. Google Maps suggests it too is a vacant lot.   

The Seven Hills site is a series of eight connected blocks, totalling 4400m², at 93-95 Best Road and 1-11 Second Avenue - a short distance from Seven Hills station. Google Maps suggests the blocks at 5, 7, 9 and 11 Best Road are vacant. Single story, freestanding houses sit on each of 93 and 95 Best Road, and 1 and 3 Second Avenue. 

The Telopea site is by far the biggest of the six; a series of three connected blocks, totalling 7200m², at 6-8 Moffats Drive and 13 Sturt Street, close to Kissing Point Road. According to Google Maps, 6 and 8 Moffats Drive both contain three-story apartment blocks; seeming to consist of 6 and 12 small apartments respectively. 13 Sturt Street contains two three-story apartment blocks, seeming to consist of 6 apartments each. 

The Tweed Heads site is a 1800m² block at 33-35 Boyd Street, close to the Queensland border. Google Maps suggests that 33 Boyd Street is a vacant lot, and 35 Boyd Street contains a single-story house. 

Project timeline

In October and November 2015, NSW Land and Housing Corporation, in conjunction with Ernst & Young, conducted industry briefings and 'market sounding' meetings with potential construction and operations partners. 

The Communities Plus website includes a basic timeline for further progression of the project into the second quarter of 2016:

"- 27 November 2015: Ivanhoe Estate at Macquarie Park Registrations of Interest (RoI) open
- 4 December: First Six Sites under the Communities Plus program Expressions of Interest (EoI) open
- 17 December 2015: Ivanhoe RoI closes
- 16 Feb 2016: Other Sites EoI close
- March 2016: Ivanhoe Industry Briefing & start of Procurement
- March/April 2016: Other Sites Request for Proposal"

Allocation requirements

The front page of the website includes this statement from Social Housing Minister Brad Hazzard MP: "Communities Plus will be at the forefront of encouraging people in social housing to be aspirational, not generational. Many of the new social housing units will be used to trial innovative programs that link housing assistance to participation in education, training and local employment opportunities to promote independence". 

The presentation that accompanied the industry briefings also includes the following quotes:

"What's Different About Communities Plus...
- Social housing tenants benefit from engagement, learning and employment
- Tenancy management that links supports to tenants who can benefit
- Return on investment includes social and economic outcomes"

"What Will This Mean For Social Housing Tenants?
- Targeted allocations
- Tenancy management with additional support
- Social housing, a platform for independence"

This represents a novel approach. Current FACS Housing policy provides that allocation of public housing is not dependent on tenant participation in education, training, employment, or other support initiatives. 

Our concerns

These projects will involve the demolition of dwellings that are currently tenanted, and many households will need to be relocated. FACS claims its staff are experienced in assisting tenants through these types of process, having learnt much from earlier renewal projects. But testimonial from places such as Millers Point, Claymore and Bonnyrigg give a different perspective - such as this article in today's "Sydney Central" local paper. Independent research into the impact of relocation - and what specifically helped long-term tenants adjust to new homes, neighbourhoods and communities - should be commissioned and considered before proceeding with any projects involving the renewal or disposal of currently tenanted stock.

And the idea that a social housing tenancy is at odds with 'independence' is starting to pervade the policy landscape - and social housing tenancies are becoming further enmeshed in our welfare systems alongside concepts like "mutual obligation". But expecting tenants who are eligible for social housing to promptly resolve their need for assistance and exit into an expensive and insecure private rental market is both cruel and unrealistic.

Cowper Street sale, development announced

On 9 December 2015, NSW Social Housing Minister Brad Hazzard announced the sale of a lot on Cowper Street, Glebe, to developer Roxy Gordon Pty Ltd. 

According to a media release issued by Mr. Hazzard, a mixed use development will be constructed on the site. The project will consist of 497 new dwellings - 247 private dwellings (49.7%), 159 social housing dwellings (32%), and 91 affordable housing dwellings (18.3%). The affordable housing component will be provided to "key workers". The Government intends to submit a development application for the project prior to Christmas 2015, and expects works will be completed by the end of 2018. 

Artist's impression of the Cowper Street redevelopment

The sale price for the site was $67 million. The Minister's press release says this will be reinvested to cover the social and affordable housing component of the new development. It is unclear how much construction of the social and affordable dwellings is expected to cost. 

According to a Family and Community Services media release dated 17 June 2015, Bridge Housing will manage the social housing component of the development, and City West Housing will manage the affordable housing component. According to an article in The Sydney Morning Herald dated June 13 2015, NSW Treasury has also provided title to this land to the community housing providers. 

The Cowper Street site has been vacant since the demolition of fifteen public housing apartment blocks in 2011. Hansard states that the former site contained 134 public housing units, and 208 tenants were relocated prior to demolition.

A separate development application for the site was lodged by the Government in 2011, but was contested by community groups. According to a Sydney Morning Herald article dated 14 May 2011, this development application was for a mixed use residential site of 493 dwellings - consisting of 250 private units (50.7%), 153 public housing units (31%), and 90 affordable housing units (18.3%). 

The project has not been listed as part of the Department of Family and Community Services' 'Communities Plus' program. The relationship between the Cowper Street redevelopment and the '$1 billion Social and Affordable Housing Fund' is not clear. 

Please comment below if you've seen or heard anything about the Cowper Street redevelopment not included in this story. 

Macquarie Park redevelopment update

The NSW Government has released further details of the Macquarie Park redevelopment.

According to a Department of Family and Community Services media release, construction works will take place on the site of the NSW Land and Housing Corporation's Ivanhoe Estate. It follows that State Property Authority land in Macquarie Park will not be utilised, and no private property will be acquired. Furthermore, the precise number of affordable housing dwellings to be constructed is 128.

An artist's impression of the Macquarie Park redevelopment

The redevelopment will also form part of a new FACS initiative called 'Communities Plus'. According to Fairfax Media's story on the announcement, the initiative will deliver approximately 550 social, affordable, and private dwellings in Gosford, Newcastle, Tweed Heads, Seven Hills, Telopea, and Liverpool, in addition to the Macquarie Park project. 

Precise details about the initiative are not yet available. It appears that all Communities Plus developments will contain a mix of social, affordable, and private residences. According to Fairfax, developers will hold the private dwellings, the NSW Government will hold social housing dwellings, and community housing providers will hold affordable housing. 

In the Fairfax story, FACS Minister The Hon. Brad Hazzard MP also describes Communities Plus as, "a new way of thinking in social housing. Many of the new social housing units will be a base for pilot programs that link housing assistance to education, training and local employment opportunities." And the FACS media release describes the project as a collaboration of "the very best in urban design, construction, community engagement and tenancy services."

Minister Hazzard will host an industry briefing on Communities Plus on 4 November 2015. 

Redevelopment of Macquarie Park, 2016-2018

The NSW Government has announced an extensive redevelopment of the Sydney suburb of Macquarie Park.

Macquarie Park is situated in northwest Sydney. It is part of the City of Ryde, though borders the North Shore councils of Ku-ring-gai and Willoughby. It is home to the Ivanhoe Estate – a medium density public housing complex consisting of 259 townhouses and apartments, and approximately 460 residents. Ivanhoe was built approximately 25 years ago.  

 

NSW Government plans to build 2500 new apartments in Macquarie Park by 2018, with construction commencing next year. The number of new residences could rise as high as 5800 between 2019 and 2031, though the Government has not actually confirmed what, if any development will take place following the first stage of construction.

Irrespective of the final scope of the redevelopment, it will represent a substantial increase in the population density of Macquarie Park. According to City of Ryde data, current density is 9.10 persons per hectare over 676 hectares. At the 2011 census, its total population was 6149. Indeed, the suburb is presently comprised mostly of university grounds, commercial properties, parklands, and low-density housing.

Effect on public and affordable housing stock

The Ivanhoe Estate will be demolished as part of the redevelopment. However, the first stage of construction will include 556 new public housing dwellings (that is, 22.24% of total new dwellings).

This represents a better net result for the public housing stock than provided for in the Macquarie Park Task Force’s development fact sheet, published in May 2012. This provided that, “If the Ivanhoe estate is redeveloped, the same number of social housing homes will be built. There will be no loss of social housing in the area.”

The 2016-2018 developments will also include an affordable housing component. Media reporting conflicts on precisely how many affordable housing dwellings will be built. The Daily Telegraph’s report, available here, says there will be 128 affordable housing dwellings (5.12%). The Sydney Morning Herald says “about 25 per cent” of total dwellings will be either public or affordable housing. Given the public housing component is confirmed to be 556, this would mean about 69 affordable housing residences (2.76%) will be built.

Effect on current public housing tenants

NSW Family and Community Services Minister Brad Hazzard has said that, from 2016, FACS Housing will assist residents of the Ivanhoe Estate to relocate to available public housing properties in the vicinity of Macquarie Park. The Minister said that FACS Housing will also offer Ivanhoe residents the opportunity to move back into Macquarie Park once redevelopment is complete. 

This is largely consistent with what was provided in the Macquarie Park Task Force’s fact sheet; “Where tenants are moved out of the estate to allow redevelopment to take place, they will have the option of moving back to the estate provided that a new dwelling is available that is also suited to their needs.”

Macquarie Park and all surrounding suburbs are situated in FACS Housing’s Northern Sydney allocation zone. FACS Housing lists current wait times in Northern Sydney for those eligible for public housing as “10+ years” for all types of dwelling. This suggests that public housing availability in the vicinity of Macquarie Park is generally very low.

Nothing announced to date gives credence to the rumour, published in a Daily Telegraph story in 2014, that “Public housing tenants could be forced to pay full rent after five years under a “work for the dole”-type public housing trial in Macquarie Park”.

Land acquisition

It is not yet clear whether any privately owned residential properties or commercial land will be compulsorily acquired to facilitate the redevelopment.

However, the Macquarie Park Task Force fact sheet states that, collectively, the State Property Authority and NSW Land and Housing Corporation already own 12.2 hectares of land in Macquarie Park. The Ivanhoe Estate is built on approximately 7 hectares. 

Infrastructure Investment

The Sydney Morning Herald report linked above says the NSW Government will invest $5 million into new infrastructure to accompany the redevelopment. The Daily Telegraph says a new school “could be built” as part of first stage of construction.

It is unclear whether construction of the school would be paid for out of the $5 million infrastructure budget, or by private developers in return for permission to undertake for-profit construction – as occurred, for example, with construction of the Homebush Bay bridge.

Windfall

According to the NSW Government’s Globe program, the land value of the Ivanhoe estate site is approximately $45,000,000. As the Government has not yet announced what, if any additional land will be utilised for construction, it is not possible to calculate additional land values.

Data reflecting projected sales figures for apartments and commercial land to be sold on the private market has not been made publicly available.