Brad Hazzard media release: Ivanhoe Estate + new Communities Plus sites

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Thursday, 25 August 2016

HOUSING PROJECT DELIVERS STRONG INTEREST

The first Communities Plus renewal project at Ivanhoe (Macquarie Park) has sparked strong interest from the private sector development industry and Community Housing Providers (CHPs), said Minister for Social Housing, Brad Hazzard.

“The three shortlisted organisations represent the top echelon of the private development sector and strong Community Housing Providers,” Mr Hazzard said.

“This is an extremely positive response to the Communities Plus program and shows how Government, the private sector and CHPs can be innovative and band together to deliver more housing and better social outcomes.”

The shortlisted groups are: Exemplar Living (Lend Lease) with St George Community Housing and Capella Capital; Frasers Property with Mission Australian Housing and Citta Property Group; and Stockland with Evolve Housing and Brookfield Multiplex Constructions.

The renewal project at Ivanhoe will boost social housing, more than doubling the current 259 social housing dwellings. The project will see 556 new social housing dwellings, at least 128 new affordable housing dwellings and some 1900 private dwellings on the eight hectare site.

The NSW Government has also announced that the second Communities Plus Neighbourhood Renewal package will be offered through an Expression of Interest to Community Housing Providers and small to medium sized private developers. These ten sites will deliver an estimated 790 new private, social and affordable homes into the high demand NSW housing market.

“These ten sites will provide a 300% increase from the current number of social housing dwellings and give residents modern new homes,” Mr Hazzard said.

Neighbourhood Renewal Release 2 involves sites in Corrimal, Wagga Wagga, St Marys, Padstow, Liverpool, South Granville (two sites), Warwick Farm, Parramatta North and Lane Cove.

Communities Plus is a $22 billion redevelopment of NSW Government owned social housing estates to deliver 23,000 new social housing dwellings and 40,500 private and affordable homes in integrated communities with better community outcomes.

Affordable Housing at 'Lachlan's line', Macquarie Park

NSW Government developer UrbanGrowth has released details of its plans for Affordable Housing at 'Lachlan's line' - a major residential development in Macquarie Park, Northwest Sydney. Measuring 9 hectares, Lachlan's line sits between Epping Road and the M2 motorway, and adjacent North Ryde train station. The brownfield site was most recently owned by NSW Government agency RailCorp, and used to assist construction of the Epping to Chatswood train line. Once complete, the site is expected to house approximately 5000 residents in 2700 apartments, across 10 'super lots'. 

Above: Concept art of a completed Lachlan's line

On June 27 2016, UrbanGrowth announced that it is seeking expressions of interest from Community Housing providers - potentially in partnership with private developers - to purchase and develop one super lot as Affordable Housing for key workers. According to the associated information memorandum, this 2507 square metre lot is zoned R4 (high density residential), and has a concept design for 96 apartments, including the floor space bonus available under the NSW planning policy for Affordable Housing. Expressions of interest for CHPs and developers close on 29 July 2016, and UrbanGrowth will issue invitations to tender later this year. No timeline for the development of the Affordable Housing lot specifically is available. However, construction of residential towers at Lachlan's line generally is expected to commence in 2017, with residents moving in by 2019. 

Also announced on June 27 was an EOI and tender process for private developers concerning a further two super lots - of 6883 and 6745 square metres, also zoned for high density residential. Collectively, these are expected to house approximately 172 apartments. UrbanGrowth sold an additional super lot - the largest of the 10 - in late 2014. Shanghai developer Greenland purchased the 1.2-hectare site, zoned B4 (mixed use). According to The Australian Financial Review, Greenland intends to build up to 900 apartments on this land. There is nothing to suggest that any of these lots will include an Affordable or Social Housing component. 

Above: The Lachlan's line build site

Lachlan's line is the second major residential project in Macquarie Park being undertaken by UrbanGrowth - together with the redevelopment of the Ivanhoe Public Housing estate under the 'Communities Plus' program. TUNSW Clearing House has recorded details of the Ivanhoe project here, with an update here. The NSW Government has designated Macquarie Park and its surrounds a 'priority growth area'. 

Our response

Despite the flurry of news this week, Lachlan's line is not an especially new initiative. It was announced way back in September 2013, and the Government's vision for the site as a major residential development can be traced back at least as far as the sale of the mixed use lot in 2014. Until now, all evidence suggested the project would deliver its mammoth 2700 apartments for 5000 residents with a Social and Affordable Housing component of precisely zero; In other words, a rare and valuable opportunity spurned. According to National Shelter, rental housing in Macquarie Park and neighbouring suburbs is 'severely unaffordable' for low income households - meaning they pay over 38% of their income in rent on average. NSW Land and Housing Corporation's own initiatives and decade-long wait times in Northwest Sydney also reflect an urgent need for more Social Housing.

The news that one of the ten super lots comprising Lachlan's line has been set aside for the construction of Affordable Housing is therefore a considerable surprise, but certainly welcome. But it must be noted that the Affordable Housing lot is the smallest of the four to be put to market thus far. It is approximately 20% of the size of the Greenland lot, and one fifth smaller than the other two designated for private housing. In turn, the 96 Affordable Housing apartments will make up around 8% of the 1170 dwellings to be constructed across these four lots. Which is not insignificant in itself; But if the remaining lots are given to private development, that will mean that just 3.5% of all housing at Lachlan's line is Affordable. Moreover, there is still no indication that the project will include any Social Housing at all.

We therefore call on the Government to build on its good work. It should ensure that the remaining six lots at Lachlan's Line include a substantial Social and Affordable Housing component - thereby delivering a true mixed tenure development for the benefit of all of Northwest Sydney. 

Finally, the words of Planning Minister Rob Stokes, speaking to 7 news about Lachlan's line, have also given us pause for thought. He acknowledged there is "plenty of demand" for Affordable Housing throughout NSW, and noted, "We'll earmark a certain percentage in new developments such as this one for key workers - people like emergency service workers, nurses, and teachers". Again, we approve of the principle of including an Affordable Housing component in all major residential developments. We just hope the percentage the Minister has in mind is significantly higher than 3.5. 

Ivanhoe Estate redevelopment timeline

The Land and Housing Corporation-lead redevelopment of the Ivanhoe Estate in Macquarie Park was announced in September 2015. Six months later and on the ground work has commenced, with the relocation of current tenants now taking place. 

But the proposal existed, in a number of distinct incarnations, for over four years prior to last year's decision. The Ivanhoe Estate Tenant Group has posted a timeline to its Facebook page of events leading up to the September announcement (original link here). The story it tells is one of equivocation, referral, and delay - as well as years of uncertainty for the residents affected:

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.