Add CategoryA fight over an $88,000 per dwelling levy on developers threatens to delay construction of thousands of new homes in Geelong’s northern and western growth corridor.
Major developers have turned to planning minister Sonya Kilkenny to intercede over the $1.6m per developable hectare development contribution levy, which the City of Greater Geelong will earn $318m toward community infrastructure in the 345ha greenfields area at Bell Post Hill.
The Creamery Road precinct is the first to be developed in the corridor stretching from Batesford to Lara.
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Under the plan, 195ha is available for development, capable of holding about 3645 dwellings, with the remainder reserved for public open space, wetlands, drainage basins, schools, and a “Clever and Creative Corridor”, which will connect all major activity centres and key land uses across the growth areas to support bicycle lanes, wide tree-lined pedestrian paths and rapid public transit.
Villawood Properties executive director Rory Costelloe said the developer contribution plan (DCP) would make building economically unviable.
“It’s just completely unrealistic and unworkable,” Mr Costelloe said.
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Villawood Properties owns a large swathe of land in the first precinct due to development in Geelong’s western growth corridor.
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The future urban structure plan for the Creamery Road precinct at Bell Post Hill.
“We’ve asked for ministerial interventions, so there’s a fair bit of discussion going on between ourselves and the state government and council at the moment. We haven’t got a result yet.”
Mr Costelloe said Geelong developers had collectively approached the minister’s office to get involved and “get the levy back to a realistic number”.
“At those rates, we’d sell the blocks at the current price and make a loss, so we couldn’t possibly go ahead.”
Mr Costelloe said walking away wasn’t an option as the company had bought the land, but warned of delays until a “logical outcome” was reached.
He said 56 per cent of the area being developable compounded the size of the levy per hectare.
“There’s a high shopping list of things to go in it, and a very low yield of land, that’s like a double whammy effect.”
Mark Whinfield at Newlands Developers, which has partnered with the Lovely Banks consortium to deliver a 15,000-lot community near Lara, said the DCP risked slowing the rate of development.
Villawood Properties executive director Rory Costelloe.
The Elcho Road East precinct, which includes the Lovely Banks development, is the next area in planning.
“We’re certainly interested to see where that gets to because the DCP is astounding.”
He said the highest DCP at Armstrong Creek was $470,000 per developable hectare.
City chief executive Ali Wastie acknowledged the concerns of developers and hoped the minister would soon endorse the plans so that parties could make submissions.
“These submissions can be considered in a transparent and balanced way,” Ms Wastie said.
“Developers will have an opportunity to voice their concerns regarding costs associated with providing adequate open space and community infrastructure which form part of the DCP rate.
“Council also must ensure that infrastructure placed by the developers can be adequately maintained in a cost effective manner so as not to burden current and future ratepayers. Submissions will be considered by an independent Standing Advisory Committee Panel.
The State Government has been contacted for comment.
Greater Geelong CEO Ali Wastie said developers can make submissions about the DCP once the Minister endorses the plans to be put on exhibition. Picture: David Crosling
Revelations of the involvement of the minister’s office in the structure plan dispute comes after Premier Jacinta Allan released a 10-year greenfields housing plan amid a week of housing-related policy announcements.
Geelong has the biggest target for building new homes under the Victorian Housing Statement, which proposes 139,800 new homes by 2051.
A land corridor capable of delivering 5000 homes at Bannockburn and a state-significant industrial and business park or “aerotropolis” surrounding Avalon Airport, which both are undergoing planning, were identified in the 10-year plan.
Curiously, the northern and western growth corridor was not.
The Victorian Planning Authority is preparing the Bannockburn and Avalon projects, whereas Geelong’s council assumed planning control over the city’s growth corridors.
Premier Jacinta Allan and Minister for Planning Sonya Kilkenny made a series of housing announcements this week. Picture: NewsWire / Nadir Kinani
Meanwhile, landowners are seeking to leverage interest in properties surrounding the employment precinct near Avalon Airport.
More than 500ha of land, zoned for farming and other purposes, has been put up for sale as sellers seeking to capitalise on the strategic holdings around Victoria’s second major airport.
The 3680ha area includes 1000ha of land supply for employment activities, with properties inside or adjacent to the precinct offered for sale.
Two parcels within the precinct at 65 Beach Rd and 130 Pousties Rd, are set to be rezoned for industrial use by November 2025.
Farms measuring more than 140ha each at 210 Avalon Rd, Avalon, and 1860 Princes Freeway, Point Wilson, are also up for sale, as well a nearby 100ha proposed organic fish farm, also on Avalon Rd.
Melbourne developer MAB Corporation controls a 780ha site adjacent to the airport where a $3.3bn business park would create thousands of jobs.