CTBUH Global News

Local Broker Discusses Development in Melbourne

Melbourne, Australia – 06 February 2017

In the run-up to the CTBUH 2017 Conference in Sydney, Connecting the City: People, Density & Infrastructure, the Council is examining the state of urban development in Australia’s cities. Chris Bates, a Wealth Coach & Mortgage Broker at Wealthful, has profiled development in Melbourne on a post for LinkedIn, which has been reproduced in-part below. Check back in a few days for an update on Sydney.

If you have been to Melbourne in the past five years you would have seen the change through cranes. Melbourne has been building tower after tower, and surprisingly is just getting started. Melbourne has a lot of big sites under construction right now but also a huge amount in the proposal phase. Over the next five years hundreds of new towers will be built.

Each month I get the pleasure to spend my time in both Melbourne and Sydney. Most of my clients are younger families and they are split across both cities. I love the variety of working in both cities because a lot of what Sydney has, Melbourne doesn't, and a lot of what Melbourne has, Sydney doesn't.

A few years ago while Sydney was sleeping, Melbourne was building. Whether you have been down to the Docklands or Southbank, Melbourne has built tower after tower after tower with some being much more attractive than others.

What I like about what is coming however is that things are changing. Most of what I have seen so far is horrible and cheaply built, but what is coming is different. Developers know they need to impress investors to stand out.

Before I begin I want to say that even though Sydney and Melbourne are our two premier cities, they are both not without their problems.

Both cities have fast growing populations with no end in sight. It's clear that there is already a serious shortage of affordable housing for young families. The recent property price boom has doubled prices in the last five years when prices were hardly cheap before. This housing boom has created an ever growing divide between the haves (those who owned property three to five years ago) and the have-nots (those that do not).

The second main problem is that both cities by global standards do not have a high population density. Both cities are spread out over vast distances – over 50 kilometers, north to south, east to west – and with very little land left.

A common problem in big global cities is that there is a high concentration of higher income employment in and around the CBD. Now while we might appreciate a low density city for an environmental and living point of view, it does create severe challenges for our transport infrastructure.

When people need to travel far distances for work they end up relying heavily on public transport. What compounds the problem is continued growth in our population and reliance on the CBD. This means our already overflowing public transport will continue to struggle to get people to work in an enjoyable way and in a reasonable time unless we do something about it.

This issue is not unknown however and both state governments have plans to try to move jobs away from the CBD to other areas.

The biggest challenge with this approach however is young people. Young people have a desire to live and work close to the city. They value the city life filled with lifestyle benefits and fast trips home. The workers actually control the employers because they are forced to stay in the city to attract top talent. If you speak to any recruiter for higher skilled employment, it’s almost impossible to get people to take jobs that are not in the city.

At the moment however, many workers do travel over 50 kilometers each way every day just to get to work. Higher house prices have pushed people to live further out from the city and it has created even more pressure on our train lines in particular.

In truth, I personally love transport infrastructure investment if it’s done productively and cost efficiently. The more infrastructure development we can do smartly, the better.

Melbourne for years has been the envy of Sydneysiders for public transport. Melbourne has a very well designed and thought-out city; a grid-based CBD and a train/tram network that really does work. The problem however is will this always work?

For more on this story, go to LinkedIn.

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