SGS Economics and Planning - City of Stonnington · 2015-12-18 · SGS - Development Projections ....

SGS Economics and Planning

Development Projections Background Report

Prepared for the City of Stonnington by SGS Economics and Planning

May 2013

SGS - Development Projections

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Chapel reVision Structure Plan 2012-2031 | “SGS Economics and Planning”

contents1 Introduction............................................... 2

1.1 Project context ........................................................................ 2 1.2 Analysis study area ................................................................ 2 1.3 Report Structure ..................................................................... 3

2 Employment Floorspace Requirements .... 4

2.1 Overview ................................................................................. 4 2.2 Retail sector ............................................................................ 4 2.3 Commercial sector ................................................................. 7 2.4 Hospitality sector ................................................................... 10

3 Housing Capacity and Demand ............... 13

3.1 Current housing overview ..................................................... 13 3.2 Potential housing capacity .................................................... 14 3.3 Potential Housing Demand ................................................... 17

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Please note: · The information in this document was prepared as background material to guide the development of a draft structure plan for the Chapel Street Activity Centre. · For recommendations relating to the draft Structure plan, including updates to the Activity Centre Boundary refer to the draft Chapel reVision Structure Plan and draft Chapel reVision Discussion Paper.


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1 Introduction

1.1 Project context

This report has been prepared as part of the City of Stonnington’s review of the Chapel Vision Structure Plan adopted by Council in 2007.

This review was prompted by a variety of factors, not the least of which was the slated expiry of Interim Planning Controls at the end of 2013. Council needed to move to an appropriate set of permanent controls which retained the objectives of the original Structure Plan but addressed key shortcomings observed in the implementation process over the 4 years to 2012. These included lack of recognition of the precinct structure within the Activity Area, a perceived failure to attract sufficient investment in high end office employment and loss of business diversity, particularly in respect of the day to day needs of the local community.

Council used in-house staff to generate the revised Structure Plan and Planning Scheme provisions with advice and information provided by three consultancies respectively specialising in the areas of architecture / urban design, urban planning and urban economics (SGS).

A key input into this process was the development of a solid evidence based understanding of the economic functioning and prospects (commercial and residential) of the centre. This background report documents this analysis including key results, analysis approach, data sources and assumptions. More specifically, it provides analysis of the current composition and future development requirements for the following sectors:

▪ Retail;

▪ Commercial (office);

▪ Hospitality; and

▪ Housing.

1.2 Analysis study area

The CSAC is comprised of three sub-precincts along Chapel Street in South Yarra, Prahran and Windsor. Figure 1 and 2 present the CSAC study area.

Figure 1 Study Area


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Figure 2 Study Area (zoom in)

1.3 Report structure

The structure of the remainder of this report is as follows.

Section 2: Documents employment floorspace requirements analysis for retail, commercial and hospitality sectors.

Section 3: Documents housing requirements analysis.


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2 Employment Floorspace Requirements

2.1 Overview

This section provides a high level analysis of the retail, commercial and hospitality sectors within the Chapel Street Activity Centre (CSAC) and estimate future floorspace requirements for the centre. The following provides an overview of the results from this analysis.

Table 1 CSAC Net Employment Floorspace Requirements, 2011 - 31 (square metres)

2011 2021 2011-21 2031 2011-31

Retail 87,500 110,000 22,500 118,500 31,000

Commercial 95,500 157,500 62,000 210,700 115,200

Hospitality 37,500 67,000 29,500 87,000 49,500

Total 220,500 334,500 114,000 416,200 195,700

Source: SGS Economics and Planning

This analysis has focused on three key sectors, representing 62 per cent of total employment. It should be noted that for the purposes of this analysis ‘commercial’ employment includes financial, real estate, professional and government services.

Beyond these three sectors there is a range of other employment types in the centre. These other employment sectors include, health, construction, telecommunications, education, arts and recreation. These have not been included within the scope of this floorspace analysis.

However, to provide an overall picture of employment growth within the CSAC the following provides a summary of total employment by the three key sectors along with ‘other employment’. From this it can be seen that 46 per cent of total employment growth in the CSAC is anticipated to be within the Commerical sector. The other sectors are expected to represent 23 per cent of future employment growth.

Table 2 CSAC Employment, 2011-31

2011 2021 2031 2011-31 AAGR

Retail 3,028 3,590 4,017 990 1.4%

Commercial 4,776 7,875 10,533 5,757 4.0%

Hospitality 2,136 3,814 4,935 2,799 4.3%

Other Sectors 6,284 8,040 9,266 2,983 2.0%

Total 16,223 23,319 28,751 12,528 2.9%


2.2 Retail sector

The CSAC is well known for its diverse and vibrant retail offer which includes both enclosed malls, markets and a significant amount of street based shops along Chapel Street and the adjoining streets. The major sub-centres within the activity centre include:

▪ PranCentral with a floorspace of 6,000 sqm

▪ Jam Factory with a floorspace of 20,000 sqm (including. cinema)

▪ Como Centre with a floorspace of 27,000 sqm (including hotel and cinema)

▪ Prahran Market with a floorpace of 7,000 sqm

Along the length of Chapel Street and across the various retail formats the centre provides for a wide rental gradient enabling both high end shopping and boutique experimental retail stores to operate.

The CSAC provides a regional centre role for its catchment as well as representing a significant tourist destination. Its main competitors include:

▪ Chadstone with a total retail floorspace of 170,000 sqm

▪ Malvern-Armadale AC with a total retail floorspace of 15,000 sqm

▪ CBD with a total retail floorspace of 530,000 sqm


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▪ St Kilda (Acland St & Fitzroy St)

The remainder of this section will estimate the current size, catchment and projected floorspace demand requirements for the CSAC. For the purposes of this analysis ‘retailing’ has been defined to include food (supermarkets, butchers, grocers, etc), clothing and other retailing (household goods, specialty stores, etc). It excludes hospitality (i.e. restaurants, cafes, bars), recreation (i.e. cinemas) and commercial services (i.e. real estate agents, banks, etc).

Modelling the current retail system

SGS has utilised an in-house gravity based retail model to estimate the current size, catchment and projected expenditure demand that will be generated in the CSAC. This model operates at a metropolitan wide level and seeks to distribute resident expenditure to all retail nodes using a mathematical algorithm that models two key elements of human behaviour; preference and proximity to a centre.

As a first step, the current retail offer and resident expenditure distribution is estimated.

Using SGS small area employment estimates (refer to section 2.3 for further detail regarding the approach and key data sources used to develop these estimates) along with the ABS Retail Trade publication (Cat. 8501), the current retail offer (i.e. turnover) is initially estimated based on a metropolitan average turnover per worker by broad store types:

▪ Food - $330,000 per employee

▪ Clothing - $185,000 per employee

▪ Other Retailing - $285,000 per employee

These average turnover per employee ratios are then adjusted at a sub-regional level (inner, middle, outer) and at an individual centre level based on additional local information such as the Census of Land Use and Employment (CLUE) and the Electronic Shopping Centre Database (Property Council of Australia). This provides the best estimate of the current performance of centres while still ensuring they balance to published metropolitan wide totals.

Finally, floorspace demand estimates are created by applying an average retail turnover density (RTD) to turnover estimates by broad store type:

▪ Food - $10,000 per square metre

▪ Clothing – $6,000 per square metre

▪ Other Retailing - $6,500 per square metre

Again these RTDs are adjusted at a sub-regional level and for individual centres based on additional local information and to reflect the more efficient retail practices in inner locations as a result of higher property costs.

The results of this analysis are presented in Table 3. From this it can be seen that CSAC has approximately 90,000 square metres of retail floorspace with 2,100 retail employees. The overall centre generates approximately $600 million per annum. This represents 1.5 per cent of metropolitan Melbourne’s retail sector. Within the CSAC itself the majority of retail activity is focused within the Prahran precinct (70 per cent).

Table 3 CSAC Retail Sector, 2011

Employment

Turnover ($m)

Floorspace (sqm)

South Yarra 500 (0.3%) 150 (0.4%) 23,000 (0.4%)

Prahran 1,500 (1.0%) 415 (1.0%) 60,100 (1.1%)

Windsor 100 (0.1%) 35 (0.1%) 4,400 (0.1%)

CSAC 2,100 (1.5%) 600 (1.5%) 87,600 (1.6%)

Stonnington (C) 8,600 (6.0%) 2,575 (6.3%) 393,000 (7.0%)

Inner 30,500 (21.3%) 9,560 (23.2%) 1,452,600 (25.9%)

Metropolitan Melbourne 143,300 (100%) 41,190 (100%) 5,614,700 (100%)


(-) represent per cent of Metropolitan Melbourne

Utilising the SGS gravity based retail model the CSAC has the following resident catchment. The primary catchment generates 25 per cent of the centres turnover and captures approximately 40-70 per cent of the resident’s retail expenditure (i.e. market


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share). Within the secondary catchment the centre generates a further 25 per cent of its turnover with a market share of approximately 5-15 per cent. The remaining 50 per cent of the CSACs turnover is generated from outside the primary and secondary catchments. This highlights the fact that it is also a key tourist and employment destination and provides for more than just a local resident catchment.

Figure 3 CSAC Retail Catchment, 2011


Forecasting retail demand

SGS has forecast potential turnover demand generated for the centre using the SGS gravity based retail model. This model uses the information available in the base year (2011) regarding centre preferences along with population and expenditure per capita

projections to estimate the additional retail expenditure within the region and the share that is likely to be captured by the CSAC.

SGS small area population projections are used to estimate the growth in households. These projections are based on the 2012 Victoria-in-Future population projections.

Expenditure per capita projections by broad store type were developed using trends evident from the ABS Retail Trade publication (Cat. 8501). These forecast average per capita expenditure to increase from approximately $9,500 to $12,000 by 2031 in real terms (note: this excludes hospitality and recreation expenditure).

Figure 4 Per Capita Expenditure Forecasts, 1996 - 31

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Using the ABS Household Expenditure Survey (Cat. 6530) along with the income profile at the collection district level SGS adjusts the state wide per capita expenditure estimates to reflect the local demographic profile.

The following table presents the estimated increase in retail turnover by broad store type based on this approach. This assumes there is no major change to the surrounding retail system (i.e. the major expansion/development of a competing centre). From this it can be seen that the CSAC retail turnover could potentially increase by $220 million. With the majority of this increase being generated from ‘other retailing’ ($115 million).

Table 4 CSAC Retail Turnover ($m), 2011 - 31

2,011 2,021 2011-21 2,031 2011-31

Food $150 $195 $45 $200 $50

Clothing $215 $220 $5 $240 $25

Other Retailing $235 $350 $115 $380 $145

Total $600 $765 $165 $820 $220


Utilising the RTDs averages from the base year this additional retail turnover demand would translate into the following floorspace demand requirements.

Table 5 CSAC Net Retail Floorspace Requirements, 2011 - 31 (square metres)

2,011 2,021 2011-21 2,031 2011-31

South Yarra 23,000 28,500 5,500 37,000 14,000

Prahran 60,000 75,500 15,500 75,500 15,500

Windsor 4,500 6,000 1,500 6,000 1,500

CSAC 87,500 110,000 22,500 118,500 31,000


This would mean an associated increase in retail employment in the CSAC. Total retail employment for the CSAC and comparison areas are presented below. From this it can

be seen that retail sector employment in the CSAC is anticipated to be in line with metropolitan growth in retail employment.

Table 6 Retail Sector Employment, 2011-31

2011 2021 2031 2011-31 AAGR

CSAC 3,050 3,600 4,000 1,000 1.42%

Stonnington (C) 12,350 13,700 14,900 2,550 0.95%

Inner 47,650 59,250 69,050 21,350 1.87%

Metropolitan Melbourne 234,350 277,900 315,000 80,650 1.49%


2.3 Commercial sector

The CSAC is also a significant commercial node within Melbourne, representing one of the largest office employment concentrations outside of the CBD. Due to its proximity and strong linkages to the CBD it is expected to see strong growth in the commercial employment sector. Figure 5 presents the density of white collar employment in the CSAC and the surrounding catchment.


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Figure 5 White Collar Employment Density, 2011


The following section will analysis the current commercial sector and estimate future floorspace requirements for the CSAC based on employment projections. For the purposes of this analysis ‘commercial’ employment includes financial, real estate, professional and government services. It excludes, retail (as defined in section 2.2), education, health, recreation and other blue collar employment. This definition captures ‘core’ office based employment and represents approximately 25 per cent of metropolitan employment.

Historical (2001 - 2011) and projected (2011 - 31) employment by industry was based on SGS small area employment projections.

SGS small area employment, population and housing estimates

SGS develops historical and projected small area employment, population and housing forecast for the Department of Transport for use in the Victorian Integrated Transport Model (VITM). The estimates are developed at a travel zones level (similar size to an ABS Collector District) and have been extensively peer reviewed. The estimates utilise a range of data inputs including the ABS Census, ABS Labour Force Survey (Cat. 6291), ABS Estimated Resident Population (Cat. 3201), Census of Land Use and Employment (CLUE), VIF2012 (DPCD) and 2004-2010 Housing Development Data (DPCD) to provide the best estimate of current and projected employment, population and housing at a travel zone level.

The historical employment series (2001- 2011) is predominately derived from the ABS Census – Place of Work datasets. However, there is a significant under count in the ABS Census - Place of Work dataset as many people incorrectly enter their work location (approximately 20%). SGS utilises a range of other information sources to scale up employment by industry and to also provide an estimate between Census periods.

Projected employment is derived from national, state and metropolitan wide forecasts of economic performance, compositional change and labour force constraint. Spatial indicator series by industry are then used to distributed employment to a sub-regional, council and small area level. This process also captures local supply

constraints/opportunities.

1 dot = 20 white collar jobs


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This top down approach combined with bottom up local level factors ensures robust employment estimates and projections that if within a broader metropolitan and national economic context.

Current commercial sector composition

Table 7 below presents the commercial employment within the CSAC along with other comparison areas. The CSAC currently has approximately 4,800 commercial sector workers. This represents approximately 30 per cent of Stonnington’s commercial sector and approximately one per cent of metropolitan Melbourne. Over the past 10 years it has added approximately 1,750 workers. This represents a growth rate of 4.6 per cent per annum, above both the rest of Stonnington and inner Melbourne growth rates.

Table 7 Commercial Sector Employment, 2001 - 11

2001 2006 2011 2001-11 AAGR

CSAC 3,050 4,150 4,800 1,750 4.6%

Stonnington (C) 12,550 12,850 14,900 2,350 1.7%

Inner 209,000 240,550 293,150 84,150 3.4%



Table 8 below provides the broad composition of the CSAC commercial sector. Form this it can be seen that approximately 50 per cent is professional services. Over the last ten years the real estate industry has seen the strongest growth (7.2 per cent per annum) within the CSAC at almost double the overall average of 4.6 per cent per annum.

Table 8 CSAC Commercial Sector Employment by Industry, 2001 - 11

2001 2006 2011 2001-11 AAGR

Finance 550 650 750 200 3.2%

Real Estate 250 450 500 250 7.2%

Professional Services 1,350 1,950 2,350 1,000 5.7%

Administrative Services 500 700 700 200 3.4%

Government 450 450 500 50 1.1%

CSAC 3,050 4,150 4,800 1,750 4.6%


Projected commercial sector requirements

The CSAC is expected to experience strong growth in the commercial sector given its historical performance, excellent range of services and infrastructure and proximity to the economic centre of Melbourne, the CBD.

Over the next 20 years commercial employment within the CSAC is expected to more than double, increasing by 5,750 from 4,800 in 2011. This level of growth is significantly higher than the metropolitan average growth rate.

Table 9 Commercial Sector Employment, 2011 - 31

2011 2021 2031 2011-31 AAGR

CSAC 4,800 7,850 10,550 5,750 4.0%

Stonnington (C) 14,900 24,200 32,250 17,350 3.9%

Inner 293,150 400,250 506,650 213,500 2.8%



Table 10 below presents the industry breakdown of the projected commercial employment within the CSAC. From this it can be seen that the professional and finance


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services will experience the strongest growth as is projected across the entire economy. This reflects a broad and continuing shift toward service based, knowledge intensive, industry sectors.

Table 10 CSAC Commercial Sector Employment, 2011 - 31

2011 2021 2031 2011-31 AAGR

Finance 750 1,250 1,650 900 4.02%

Real Estate 500 750 950 450 3.26%

Professional Services 2,350 4,250 6,050 3,700 4.84%

Administrative Services 700 950 1,150 450 2.51%

Government 500 700 750 250 2.05%

CSAC 4,800 7,850 10,550 5,750 4.02%


While floorspace to worker ratios can vary significantly for individual firms, typically it has been observed that for office employment the ratio is around 20 sqm per employee. Using this broad ratio the following commercial floorspace requirements have been derived based on the projected employment growth.

From this it can be seen that over the next 20 years, the CSAC will need to provide approximately 115,200 sqm of additional office floorspace.

Table 11 CSAC Net Commercial Sector Floorspace Requirements, 2011 -31

2011 2021 2031 2011-31

CSAC Jobs 4,800 7,850 10,550 5,750

sqm 95,500 157,500 210,700 115,200

Stonnington Jobs 14,900 24,200 32,250 17,350

sqm 297,800 483,500 644,900 347,100

Inner Jobs 293,150 400,250 506,650 213,500

sqm 5,863,100 8,005,200 10,132,700 4,269,600

Melbourne Jobs 534,200 720,450 894,750 360,550

sqm 10,684,300 14,409,100 17,895,300 7,211,000


2.4 Hospitality sector

The hospitality sector represents the final core employment element of the CSAC. The precinct is well known for its excellent range and quality cafes, restaurants, bars, clubs and accommodation options.

The following section provides a high level analysis of the current hospitality sector and estimates future floorspace requirements for the CSAC based on employment projections. For the purposes of this analysis ‘hospitality’ employment includes both food services (i.e. cafes, restaurants, bars and clubs) and accommodation (i.e. hotels, etc).

Historical (2001 - 2011) and projected (2011 - 2031) employment by sector are based on SGS small area employment projections (refer to grey box within section 2.3 for further detail regarding the approach, data sources and key assumptions used).

Current hospitality sector composition

Table 12 below presents the hospitality employment within the CSAC along with other comparison areas. The CSAC currently has approximately 2,150 hospitality sector workers.


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Table 12 Hospitality Sector Employment, 2001 -11

2001 2011 2001-11 AAGR

CSAC 1,750 2,150 400 2.1%

Stonnington (C) 5,450 5,850 400 0.7%

Inner 43,800 53,150 9,350 2.0%

Metropolitan Melbourne 103,400 135,800 32,400 2.8%


Table 13 below presents the split of food services and accommodation employment for the CSAC. Form this it can be seen that the vast majority of hospitality employment is located within the food services sector. This has also seen very strong growth over the last 10 years (3.3 per cent per annum). However, accommodation employment is estimated to have fallen over this period.

Table 13 CSAC Hospitality Sector Employment by Industry, 2001 -11

2001 2011 2001-11 AAGR

Food Services 1,450 2,000 550 3.3%

Accommodation 300 150 -150 -6.7%

CSAC 1,750 2,150 400 2.1%


Projected hospitality sector requirements

The CSAC is expected to experience strong growth in the hospitality sector given its strong reputation and historical performance.

Over the next 20 years hospitality employment within the CSAC is expected to double, increasing by 2,800 from 2,150 in 2011. This rate of growth is double that of the metropolitan average.

Table 14 Hospitality Sector Employment, 2011-31

2011 2021 2031 2011-31 AAGR

CSAC 2,150 3,800 4,950 2,800 4.3%

Stonnington (C) 5,850 9,550 11,550 5,700 3.5%

Inner 53,150 74,150 89,400 36,250 2.6%



Table 15 below presents the projected hospitality employment by food services and accommodation. From this can be seen that the majority of employment growth will be focused in the food services sector.

Table 15 CSAC Hospitality Sector Employment, 2011-31

2011 2021 2031 2011-31 AAGR

Food services 2,000 3,550 4,550 2,550 4.2%

Accommodation 150 300 350 200 4.3%

CSAC 2,150 3,850 4,900 2,750 4.2%


A floorspace per employee ratio method has been used to generate high level floorspace requirements for the CSAC. As with office employment, these ratios can vary significantly for individual businesses. Nevertheless, a typical provision for cafes, bars and restaurants is 15 sqm per employee. For accommodation facilities this ratio can vary dramatically depending on the type of facility, level of service, supplementary facilities, etc. A broad ratio of 50 sqm per employee has been used for this high level analysis. However, it should be noted that this could vary significantly based on the individual establishment.

Using these ratios, the additional hospitality and accommodation floorspace required to accommodate projected sector growth in the CSAC will need to be approximately 49,500


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sqm. Approximately 10,000 sqm of this is for the accommodation sector and the remaining 39,500 sqm for the food services sector.

Table 16 CSAC Net Hospitality Sector Floorspace Requirements, 2011-31

2011 2021 2031 2011-31

CSAC Jobs 2,150 3,800 4,950 2,800

sqm 37,500 67,000 87,000 49,500

Stonnington Jobs 5,850 9,550 11,550 5,700

sqm 99,000 162,500 198,000 99,000

Inner Jobs 53,150 74,150 89,400 36,250

sqm 1,097,500 1,512,500 1,812,500 715,000

Melbourne Jobs 135,800 172,600 196,350 60,550

sqm 2,489,000 3,163,000 3,598,500 1,109,500



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3 Housing Capacity and Demand

3.1 Current housing overview

Beyond employment, the CSAC provides for significant housing opportunities. Table 17 below presents the 2011 dwelling stock for the CSAC and comparison areas based on the 2011 ABS Census. In this table the CSAC has been defined based on a ‘best fit’ of the smallest available ABS geography (Statistical Area 1) which does includes some of the surrounding catchment. On this basis it can be seen that the CSAC and surrounding area hosts approximately 7,050 dwellings as of 2011.

Table 17 Housing Stock, 2006 -11

2006 2011 2006-11

South Yarra 1,880 2,090 210

Prahran 3,340 4,160 820

Windsor 740 810 60

CSAC 5,960 7,050 1,090

Stonnington (C) 45,060 47,120 2,060

Inner 170,290 189,880 19,600

Metropolitan Melbourne 1,473,310 1,615,650 142,330

Source: 2006 and 2011 Census: Place of Enumeration - ABS

To provide an assessment of dwelling stock and development activity specifically within the CSAC boundary itself the Housing Development Data (HDD) sourced from DPCD has been utilised. This provides lot by lot data and tracking of individual housing development projects from 2004 to 2008.

Table 18 and Table 19 along with Figure 6 present the recent housing development activity (2004-08) along with the amount and scale of current housing stock with in the CSAC.

While not as recent as the 2011 ABS Census, this provides a more accurate spatial definition of housing within the CSAC boundary itself and the type of housing development that has occurred. This can be seen when comparing the total dwellings within the CSAC between Table 17 (5,960 and 7,050 dwellings as of 2006 and 2011) and Table 18 (2,910 and 3,520 dwellings as of 2004 and 2008).

From this it can be seen that from 2004 to 2008 there were 610 additional dwellings added to the activity centre. This represented almost half of additional housing supply for the City of Stonington. The majority of these were within the South Yarra and Prahran precincts.

Table 18 Housing Stock, 2004 - 08

2004 2008 2004-08

Dwellings Site

Density Dwellings

Site Density

Dwellings

South Yarra 740 251 1,025 275 285

Prahran 2,005 126 2,280 139 275

Windsor 170 85 215 104 50

CSAC 2,910 139 3,520 158 610

Stonnington (C) 44,920 32 46,290 33 1,370

Inner 48,000 16 174,190 19 126,190

Metropolitan Melbourne 1,439,955 4 1,543,150 4 103,190

Source: Housing Development Data – DPCD prepared by Spatial Economics

Site density is a net density measure calculated from the number of dwellings divided by the size of the land parcel, excluding all other uses (i.e. parks, roads, employment land, footpaths, etc) which can be commonly

included in other density measures.

Figure 6 presents the site density of the housing stock within the CSAC and surrounding areas. From this it can be seen that while only a relatively small portion of the CSAC land actually has residential developments, these developments are very dense. The local surrounding catchment, while not as dense as the CSAC, is also denser than the rest of the municipality (to the east). This is also highlighted in Table 18 above which indicates a site density of 158 dwellings per hectare in the CSAC, compared to 33 dwellings per


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hectare for Stonnington overall. The South Yarra precinct is the most intensively developed part of the centre with a site density of 275 dwellings per hectare.

Figure 6 Current Housing Stock Site Density, 2011

Source: Housing Development Data – DPCD prepared by Spatial Economics

The 610 additional dwelling were achieved through 20 development projects (Table 19), with an average project yield of 28 dwellings. This was as high as 48 within South Yarra, illustrating the larger apartment developments occurring within this precinct.

Table 19 Housing Developments, 2004 - 08

Development Projects

Project Yield

Site Density

South Yarra 5 48 364

Prahran 15 18 353

Windsor 1 49 421

CSAC 20 28 363

Stonnington (C) 510 3 37

Inner 1,510 10 139

Metropolitan Melbourne 1,439,955 4 1,543,150

Source: Housing Development Data – DPCD prepared by Spatial Economics Site density is a net density measure calculated from the number of dwellings divided by the size of the land

parcel, excluding all other uses (i.e. parks, roads, employment land, footpaths, etc) which can be commonly included in other density measures.

3.2 Potential housing capacity

In order to determine the number of potential housing opportunities remaining with in the CSAC, a housing capacity analysis was undertaken. This analysis estimated the number of housing opportunities using a two stage process:

▪ Available Land: using a range of attributes, this determined which sites within the CSAC have potential for future development.

▪ Development Potential: using a built form analysis, this estimated the potential development which could occur within current height controls.

The 2010 Urban Development Program site specific estimates were used where available.


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The following section will further detail the results and key assumptions used during this analysis.

Available Land

Using the 2008 GIS lot layer from the Housing Development Dataset an attribute analysis was undertaken to determine which individual land parcels would be designated ‘available’ or ‘unavailable’. It should be noted this did not consider the commercial feasibility of development actually occurring. Initially, all land parcels were made available. (This already excluded roads, footpaths, rail lines, etc as having development potential). The following attributes of individual lots were then used to exclude specific land parcels:

▪ Small Lots – any parcel under 150sqm was excluded. While site amalgamation could potential make the site developable it is extremely difficult and very rare.

▪ Recent Development – any site that had been recently developed based on the 2004 to 08 Housing Development Data or from the 2002-2010 Urban Development Program - Major Redevelopment Site databases.

▪ Existing Apartments Blocks – any site with over 3 dwellings was assumed to have some form of strata titling. This has been seen to be a major barrier to redevelopment potential.

▪ Major non-residential uses – schools, churches, markets and other major non-residential uses have been excluded.

Figure 7 presents the results of this analysis. Red indicates unavailable land parcels and blue represents land parcels with housing development potential. Overall the CSAC boundary contains 126 hectares of land. Of this, 95 hectares represent land parcels (i.e. excluding roads, footpaths, etc). Of this land, 42 hectares across 870 individual sites have been identified as ‘available’ through this process.

Figure 7 CSAC Available and Unavailable Land Parcels.



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Development Potential

The development potential of available sites was then determined using the preferred maximum height controls within the planning provisions and a range of built form assumptions. The following presents the height controls applied across the CSAC

Figure 8 CSAC Development Height Controls

Source: City of Stonnington

The following built form assumptions have been made to translate a particular site into a dwelling capacity estimate.

▪ Average Storey Height – 3.5 m

▪ Site Coverage – 70 per cent of land parcel

▪ Building Efficiency – 80 per cent of floorplate

▪ Average Dwelling Size – 75 sqm

▪ Development including non-residential uses

▪ 1-2 storeys – all residential

▪ 3-7 storeys – first floor employment

▪ 8+ storeys – first two floors employment

▪ Building setbacks

▪ 1-3 storeys – no set back

▪ 4-7 storeys- 20 per cent set back on top two levels

▪ 8+ storeys – 40 per cent set back on top level, 20 per cent set back on next two levels.

Where actual information regarding the site yield was available from the 2010 Urban Development Program this was used instead of the built form analysis estimates.

From the 2010 Urban Development Program, Major Redevelopment Sites within the CSAC offered potential for approximately 2,000 additional dwellings. From the remaining available land parcels, a further 10,000 potential additional dwelling opportunities were identified.

It should be noted that it is unrealistic to assume that all 10,000 development opportunities will materialise as additional dwellings. For a range of reasons including commercial feasibility, underdevelopment, alternative development (i.e. employment). site specific circumstances and community concerns, all potential opportunities within a given location can never be totally realised. Even within the CBD of Melbourne there are vacant/underutilised land parcels that have not yet been developed.


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3.3 Potential Housing Demand

An estimate of potential housing demand by dwelling type has been estimated for Stonnington using a housing propensity model. This approach uses projected population by age estimates (sourced from 2012 Victoria in Future – DPCD) and translates it into demand for dwellings by type based on changes in demographics, family composition and housing preferences. The share of municipal wide housing demand by type that could potentially be realised within the CSAC is then also estimated.

Recent trends in housing demand drivers

The following three tables present trends in population by age, household composition and dwellings by dwelling type for the City of Stonnington from 2001 to 2011. From this it can be seen that there has been an aging of the population, with particularly strong growth in the 25-44 year age group.

Table 20 Stonnington Population by Age Groups, 2001-31

2001 2011 2001-11

# % # % # %

0-14 years old 12,036 13.4% 12,627 12.7% 591 6.5%

15-24 years old 13,153 14.6% 14,000 14.1% 847 9.3%

25-44 years old 32,100 35.7% 36,317 36.6% 4,217 46.1%

45-64 years old 20,222 22.5% 22,090 22.3% 1,868 20.4%

65 years and over 12,467 13.9% 14,084 14.2% 1,617 17.7%

Total 89,978 100.0% 99,118 100.0% 9,140 100.0%

Source: 2001-2011: Estimated Resident Population – ABS

There was small changes to the household composition of the city with an increase in the share of couple family with/without children and group households and a decrease in the share of lone person households.

Table 21 Household Composition, 2001 - 11

2001 2011 2011-2021

# % # % # %

Couple family with no children 8,763 22% 10,210 24% 1,447 61%

Couple family with children 8,052 20% 8,682 21% 630 27%

One parent family 2,383 6% 2,381 6% -2 0%

Other family 923 2% 770 2% -153 -6%

Lone person household 13,152 33% 13,198 31% 46 2%

Group household 3,259 8% 3,866 9% 607 26%

Other household 3,261 8% 3,041 7% -220 -9%

Total 39,793 100% 42,148 100% 2,355 100%

Source: 2001-2011: Census– ABS

From 2001 to 2011 there was an increase in dwellings across all types, however, the majority was achieved through the apartment dwelling type. This has resulted in a shift in the municipalities total distribution of dwellings by type from detached and semi-detached to apartments.

Table 22 Dwellings by Dwelling Type, 2001-11

2001 2011 2001-11

# % # % # %

Detached 16,020 37% 16,576 35% 556 16%

Semi-detached 8,018 19% 8,249 18% 231 7%

Apartments 19,269 44% 21,972 47% 2,703 77%

Total 43,308 100% 46,797 100% 3,489 100%

Source: 2001-2011: Census– ABS


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Projected housing demand

Based on the trends in family composition and implied housing preferences SGS has translated the following population projects (see Table 23) into a demand for dwellings within the City of Stonnington (see Table 24).

From this it can be seen that the additional 19,051 projected population increased for Stonnington will generate demand for an additional 11,429 dwellings. Based on the recent changes in demographics, family composition and implied housing preferences continuing into the future 57 per cent of these are anticipated to be semi-detached with the remainder being apartment housing. There is also likely to be a very slight reduction in demand for detached housing (-110), relative to the current stock.

Table 23 Stonnington Projected Population, 2011-31

2011 2021 2031 2011-31

# % # % # % # %

0-14 years old 12,627 12.7% 13,302 12% 12,386 10% -241 -1%

15-24 years old 14,000 14.1% 14,583 13% 15,240 13% 1,240 7%

25-44 years old 36,317 36.6% 41,404 37% 42,778 36% 6,461 34%

45-64 years old 22,090 22.3% 23,365 21% 26,610 23% 4,520 24%

65 years and over 14,084 14.2% 18,323 17% 21,155 18% 7,071 37%

Total 99,118 100.0% 110,978 100% 118,169 100% 19,051 100%

Source: 2021-2031: 2012 Victoria in Future – DPCD

Table 24 Stonnington Projected Housing Demand, 2011-31

2011 2021 2031 2011-31

# % # % # %

Detached 16,576 35% 16,898 32% 16,466 28% -110 -1%

Semi-detached 8,249 18% 11,642 22% 14,792 25% 6,543 57%

Apartments 21,972 47% 25,057 47% 26,968 46% 4,996 44%

Total 46,797 100% 53,597 100% 58,226 100% 11,429 100%


Compared to recent development trends (Table 22) this analysis suggests there is significant demand for semi-detached housing across the municipality which is not being delivered. This demand is likely be accommodated through apartments and to a lesser extend detached housing.

From 2004-2008 the CSAC captured 45 per cent of the Municipalities additional housing. However, future development within the CSAC is likely to be limited to apartment type housing with semi-detached likely to occur within the surrounding catchment. Given this over the next 20 years the CSAC could expect to capture demand for approximately 5,000 additional apartments.

SGS Economics and Planning - City of Stonnington · 2015-12-18 · SGS - Development Projections ....

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