Sydney CBD planning policy changes tack in bid to temper residential mix

But some developers have bridled at proposed planning restrictions in the policy, one of which would be to limit the proportion of residential use in the tallest new towers in the CBD to 50 per cent.

Graham Jahn: “With Webers on the balcony, we would have risked the Reserve Bank maybe going to Melbourne.” Photo: Ewen Bell

In advocating the policy to a function organised by the development industry on Thursday, the council’s director of city planning, development and transport, Graham Jahn, argued some form of management was needed to preserve a mix of uses and the economic vitality of the city centre.

Mr Jahn said there tended to be a “critical point” in cities where, if there was too great a concentration of residential development, premium commercial uses were no longer attracted to the area.

“It is a challenging reality for a city administration so successfully pro-residential to come to terms with these issues,” Mr Jahn said.

For the past two decades, the council has been encouraging people to move to the centre of the city, and has put in place planning policies aimed at making residential towers easier to build.

But in a change of tack, the city is now attempting to temper that residential mix. According to Mr Jahn, the area around Haymarket and the south of the city “is gone … as far as premium commercial space” goes, because of the large volume of residential structures in the area.

Asked what the next section of the city would be to follow the same dynamic as Haymarket, Mr Jahn nominated the mid-town area around Market Street and Market Place.

“It’s the area where retail is, for example, where there is a tower on Myer, a potential tower on David Jones, City Tatts and others,” Mr Jahn said.

“A lot of it comes down to how it is done, what you see at ground level.

“At one point there was a possibility for a residential building at Martin Place opposite the Reserve Bank. I think if that had been the case, with Webers [barbecues] on the balcony, we would have risked the Reserve Bank maybe going to Melbourne and that would be diabolical.”

The city’s policy, therefore, is aimed at preserving commercial space in the heart of the city.

Mr Jahn was speaking at a breakfast hosted by the developer group the Urban Taskforce.

The chief executive of the Urban Taskforce, Chris Johnson, said his organisation was “positive and strong about the strategy in terms of driving jobs and increasing heights and the capacity for jobs and commercial development, however we are concerned there may be a negative impact on residential”.

Mr Johnson said requiring buildings to mix residential and other uses could be a difficult model to work. “There’s different financing for both projects,” he said.

Building owners and vendors say they have already started to see the impact on property prices of the proposed new planning limits. The draft strategy has also been welcomed by the Urban Development Institute of Australia.