Central Sydney Planning Strategy’s sky-high towers – solving the planning puzzle for a Global Sydney

The potential density uplift available in a Tower Cluster would be limited to a 50% FSR bonus above the current planning controls – a reasonable “stretch point” for a DA pathway, according to the City of Sydney. No additional design excellence bonus would be applied above this 50% bonus.

This is a clear shift from the previously mooted approach where applicants could explore uplift well beyond this under the Council’s ‘Draft Guideline for Site Specific Planning Proposals in Central Sydney’ if they were pursuing a Planning Proposal.

The approval pathway to achieve development uplift is consistent with the City of Sydney’s staged DA process, albeit with a mandated approach to up-front design testing, as well as refinement to the City’s Design Competition Policy for site’s located within a Tower Cluster. The minimum cost of a competition process under this scenario is likely to be in excess of $1 million due to the cost of competitors, technical advisers and jury members.

The following is an outline of the approval process required to achieve development uplift with the Tower Clusters:

While being a ‘mapped’ Tower Cluster site is a good start, there are several practical challenges to achieve the uplift, or for redevelopment opportunities to occur, including:

• Minimum Site Area: A minimum site area of 2,000sqm is required to qualify (double the previous minimum site area of 1,000sqm in the Strategy). This area must also exclude the area of any heritage item.
• Heritage: There are numerous sites in Tower Clusters that contain either Local or State Listed Heritage Items which are unlikely to be redeveloped for tower developments (for example The Sandstones Precinct, Museum of Sydney, Radisson Blu Hotel, First Government House Place).
• Sun Access Protection: While being located within a sun access protection area doesn’t preclude the redevelopment of sites, it does potentially limit the extent of redevelopment possible.
• Contemporary Developments: There are some recent developments, DA approvals or projects under construction, which have been approved under the current planning controls and have a high design quality, strong rental returns and/or are unlikely to be redeveloped soon given their current asset cycle. For example 1 Bligh Street, Farrer Place, Governor Philip Tower, Circular Quay Tower and One Circular Quay.
• Strata and Fragmented Ownership: There are many sites in the CBD that comprise of complex strata arrangements, which adds complexity to these sites being amalgamated quickly.

There are many alternative strategies that could unlock commercial floor space and deliver the intended outcomes of the CSPS to a greater extent. These may include the following: 

• Removing the 50% FSR uplift cap and allowing this to be the outcome of the ‘rigorous’ design testing during the Concept DA stage, and before any competitive design process. Why preclude a higher FSR if it otherwise addresses the City’s strategic directions.
• Revert to the minimum site area requirement of 1,000sqm to allow a greater number of sites to potentially qualify for uplift, noting that there are many sites much less than 2,000sqm that can satisfy the Council’s design requirements.
• Adequately incentivise the revitalisation of existing commercial office assets by allowing alterations and additions to enjoy a similar degree of flexibility with height and density standards, noting the City’s relatively strong position on Clause 4.6 variations to these. In our view, this could cumulatively deliver a significant amount of new commercial office floor space in various parts of the city – aligned with the sustainability aspirations of recycling assets as opposed to full redevelopment.
• Explore the relaxation of development contributions, where refurbishment and revitalisation occur to existing commercial office assets and no additional floor space is proposed. Why should replacing a combustible façade on a building attract development contributions when it is adding no immediate value or additional density to an asset.

By taking a closer look at the northern CBD cluster, taking into account constraints of the CSPS, we determined that a limited number of sites remain that can truly deliver the CSPS’ intended employment outcomes. Some of these sites are owned by institutional fund managers, while the ownership of others is fragmented and may take longer to piece together.

Based on the Council’s preliminary capacity analysis, a number of these sites have the theoretical capacity to take much more than 50% above the base density controls (i.e. up to 27:1 FSR in some cases which is a considerable jump from 18:1). The potential misalignment in density capacity with the CSPS is likely to force applicants to explore site-specific Planning Proposals to achieve an optimised outcome.

The City of Sydney has acknowledged that site-specific Planning Proposals outside of Tower Clusters may continue to play a role in delivering the employment outcomes of the CSPS. Tower Clusters are simply one means of achieving uplift in certain parts of the CBD. We foresee many opportunities apart from Tower Clusters, that have significant increased density potential and are aligned with the City of Sydney’s aspirations.  We expect an update to the initial guidelines for Planning Proposals,  providing further direction to the industry on achieving uplift in the CBD.

We encourage the industry to take the opportunity to make your opinion count, by providing feedback on the CSPS and associated Planning Proposals, which are on public exhibition from 1 May until 10 July 2020. View all relevant documents via the City of Sydney website.

The complete endorsement pathway for the CSPS and Planning Proposal is outlined below:

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