Spare a thought for NIMBYs

 

The dreaded “Not In My Backyard” reaction of homeowners who have the temerity to object to neighbourhood changes they never voted for (or were even asked about) is reaching plague proportions, if you believe what some urban designers and planners are saying.

This scourge of the NIMBY is threatening the progressive development of cities, they’ll allege. The NIMBY is now to blame for everything from housing affordability to urban congestion. Why can’t young Australians find a home they can afford? Because of those nasty, selfish NIMBYs. Why can’t seniors find a suitable property to downsize into within their own neighbourhood? NIMBYs again, curse them.

These comments from Brendon Coates at the Grattan Institute earlier this year are one example. Speaking at a Henry George Memorial Lecture, the NIMBY was given the full Kangaroo Court treatment, and found guilty without trial. “NIMBYs make housing unaffordable: Grattan Institute” roared the headlines.

According to Coates: “The key problem is that many states and local governments restrict medium- and high-density developments to appease local residents concerned about road congestion, parking problems, and damage to neighbourhood character.”

Let’s take a moment to consider what’s being said here and try see things from the NIMBY point of view. First, their home truly is their castle. Their home is the biggest single financial asset they are ever likely to own. Unlike their superannuation fund, it is within their control to add value and to enhance its appeal both as a place to live, and for long term financial security. And unlike their superannuation fund, there are no third parties in fancy CBD Offices charging them exorbitant fees to manage their home. A third of Australian households own their home outright, and a further third are paying it off with a mortgage. The remaining third are renting, and nearly all of that rental stock is also privately held by individuals hoping to build on their financial security via an investment in housing.

As property owners, they are all rightly heavily invested in what happens in their street and in their neighbourhood. For this reason, they are legitimately concerned about things like “road congestion, parking problems, and damage to neighbourhood character” – but according to Grattan, responding to these concerns is “appeasement” by state and local governments.

How disappointing it must be for these urban visionaries as they gaze out at the suburbs from their CBD glass towers, imagining all those ‘McMansions’ being bulldozed in favour of rows of townhouses and unit blocks, having to confront the objections of homeowners who defy the utopian urban density dream.

Incredibly, the suggestion seems to be that homeowners are not only being unfairly obstructionist in objecting to changes which might in their opinion diminish the value of their homes and assets, but that being a home owner should somehow disqualify you from having a say. According to Coates:

“The politics of land-use planning – what gets built and where – favour those who oppose change. The people who might live in new housing – were it to be built – don’t get a say.”

Meaning that non-owners who have no personal investment in a neighbourhood are being unfairly  disadvantaged because they are not getting a say about what happens to someone else’s biggest single financial asset and home?

Talk about egos and entitlement. “Father knows best” paternalism is a professional trait which happily tramples on homeowners interests if they dare get in the way of some “expert” opinion about whether their choice of home and location is “appropriate” or not. In 2019, the City of Brisbane prevented further development of townhouse style “missing middle” housing product in low density streets of detached homes. The uproar and indignation of some professionals at the time was a disgrace.

“The community doesn’t understand the full story because they are not experts in the field of City design and planning” said one town planner on industry portal Linkedin.

“It’s concerning that we listen to the general public for planning in our city rather than the experts who understand growth of a city,” said another. Wow. Imagine listening to the general public in a democracy? Why bother when you have unelected experts ready to tell you what’s in your best interests?

The so-called “townhouse ban” was in response to the feedback of more than 100,000 residents who responded to a widespread community survey “Plan Your Brisbane.” Planning Chair at the time, Cr Matt Bourke, said: “Their feedback was clear – no more cookie-cutter townhouses on properties that are intended for single homes.”

Neither side of politics will show much interest in pushing for policy changes which the people who elect them vigorously oppose. This is called democracy. When Labor Deputy Mayor David Hinchliffe gave the annual Keeble Planning Lecture in 2017, he observed that:

“If you push too hard for this [planning] ideal in the face of that [public] reality, it becomes a political issue in your community, you get defeated and the person who replaces you invariably has learned the lesson of your demise and will make it much harder for planners to wield that [policy] stick in their patch in the future.”

“In public life, if you don't learn that, you don't stay around long.”

Ironically, industry groups or larger developers who complain about the NIMBY phenomenon can at the same time be guilty of their own version of zoning protectionism. One look at how viciously the anti-competitive “retail hierarchy” planning laws (which effectively prevent further competition within defined trade areas) are fought out in court shows that self interest is a powerful motivator. “We would object to a competitor moving a pot plant if we thought it in our interests,” a senior Westfield operative once said to me. Doesn’t this make Westfield and other large corporates no different to the home owning NIMBY?

The attacks on NIMBYs though will continue. They will be accused (and found guilty) of everything from causing climate change to social inequity. The accusers will be the same usual cabal of unelected academics, urban “visionaries” and assorted media commentators whose own homes and lifestyles are no doubt safely protected from adverse policy changes while they lecture others on their selfish ways. And the tensions will only increase as competition for space and housing increases.

How will NIMBYs respond? That’s best left to Darryl Kerrigan – lead protagonist in Aussie film classic “The Castle”:

Darryl: Tell em to get stuffed!

(He also said: “What are you calling an eyesore? It’s called a home ya dickhead!)

Where we work defines how we get there (and explains a lot about the public transport challenge)

Where we work has everything to do with the transport choices available to us for getting there. For CBD and inner-city workers, transport choices are amongst the widest – including a variety of forms of public transport (ferries, buses, trains) along with more options for walking and cycling (thanks to the infrastructure but also because CBD and inner city workers tend to live close to the inner city).

If almost everyone worked in the CBDs and inner cities, the fantasy of public transport advocates (“we must get people out of cars and onto public transport”) could be realised. But the economic reality is that the proportion and number of jobs in CBDs and inner cities remains low and is likely to fall further in the future. The greatest majority of jobs are suburban, and these workplaces are typically not served by public transport.

Evidence of this economic reality is provided by the Census, for those who can be bothered to consult the data.

The graph below shows total job numbers for Southeast Queensland by location based on the Census results of 2011, 2016 and 2021. This is for all jobs – part time, casual and full time, and for all industries.

In 2021, Brisbane’s CBD was home to 146,393 jobs. In the 10 years since 2011, this had grown by 30,261 jobs (part time, casual and full time remember -  full time white collar professionals are a subset of this number). The inner city reached 235,441 jobs or growth of 49,067 since 2011 while the SA4 statistical area (very crudely approximating a 5 klm radius from the CBD) reached 364,268 jobs and growth of 77,488 jobs.

The greater Brisbane metro region by comparison was home to 1,194,277 jobs – an increase of 268,888 jobs since 2011. The SEQ region – which forms the basis of most planning frameworks – reached a total jobs pool of 1,702,408 or a decade increase of 481,896.

What this indicates is that the CBD and inner city are overall a minority destination for the 1.7 million employed in SEQ. Yes, the CBD/inner city is the largest single job agglomeration, but in terms of its overall share of jobs by location, we are talking a destination for a minority of the region’s employed. The CBD accounts for 8.5% of jobs in the region, the inner city for 14% and the wider 5klm ring (for which there seems no scientific or professional basis other than it’s a popular measure) for 21%. Even at the most generous spatial definition (a 5klm radius is a 10klm diameter - which stretches well into leafy suburban areas) there are 8 in 10 people who do not work in the inner city.

This lies at the root of the public transport challenge. The hub and spoke nature of public transport (which tends to serve the CBD and inner city) works for only around 10% to 15% of people with inner city or CBD jobs to go to. Increasing investment in public transport networks which reinforce this hub and spoke structure will not increase the proportion for whom PT is a legitimate choice (though it will no doubt add to the amenity and comfort of those for whom it already is).

Adding to the challenge is that, despite decades of adulation and the bestowment of almost mythical job creation and attraction powers, CBDs and inner cities are not growing as fast as job markets in metro and suburban regions. Technology (and now WFH) is eroding the numbers of jobs in inner city locations, while much faster jobs growth in health and education industries are fuelling significant job growth in suburban and outer areas. Finance and property was once (in the 1990s) in the top 5 growth industries. It is now bottom 5. Health and education lead growth on almost any indicator you care to consult.

Another way of looking at this is by what shares of jobs growth are going where. Over the ten-year period to 2021, the Brisbane CBD secured 6% of regional jobs growth and the inner city 10%. Metro Brisbane (for which read suburban business districts, strip centres, shopping centres and other locations) accounted for more than half.

This geographical pattern of job growth and contraction is reshaping our cities but sadly so much of our thinking remains rooted in the mistaken notion that “most jobs are in the inner city.” Inner city professionals in fields as diverse as public policy, government administration, academia, planning, property, law, engineering and the like seem to have fallen into the trap of thinking that everyone must be like them: commuting to inner city office towers. As the economy grows (they argue), many more jobs will be in the inner city so to address congestion, we must invest more in public transport networks designed to carry people from middle and outer suburban homes, to their inner city workplaces. There is no evidence to support this. The reality is very different.

There are things we could be doing. Exploring options around electric, autonomous vehicles (including as PT), along with more tunnels to move more suburban traffic (which includes, increasingly, freight). A more dispersed transport network that will serve an increasingly dispersed future economy. There are unexplored options around train stations as work destinations (not just as places to embark for a city bound journey). Plus there are many options for the development of mixed use suburban business hubs – suburban renewal which mixes housing, work and social infrastructure such that shorter trips are possible and bringing both jobs and services closer to where people live.

Former US President John F Kennedy once famously said: “The great enemy of truth is very often not the lie - deliberate, contrived and dishonest - but the myth - persistent, persuasive and unrealistic. Too often we hold fast to the cliches of our forebears. We subject all facts to a prefabricated set of interpretations. We enjoy the comfort of opinion without the discomfort of thought.”

That was way back in 1962. Are we really such slow learners?

 

(Future analysis of other capital city jobs geography coming soon).

Is a housing shortage the least of our worries?

So, the “National Jobs & Skills Summit” succeeded in what seemed a predetermined outcome: to lift migrant numbers and boost our population once again. Permanent migration will be lifted to 195,000 per annum, to address “skilled labour shortages” that are “holding back the economy.”

Set aside that full employment would ordinarily see real wages grow (a much needed outcome of ‘supply and demand 101’ – and something that hasn’t happened for a long time), the acceleration of migration and population growth will have consequences. One of those is the question of housing, with a number of industry groups and ‘think tanks’ like The Grattan Institute arguing for measures to rapidly increase the supply of housing. Their preference is to overturn community objection to high and medium density housing, which they claim is restricted by local governments “to appease local residents concerned about road congestion, parking problems, and damage to neighbourhood character.” I mean, how dare residents object to congestion, parking and damage to the character of their neighbourhoods. Bloody peasants! (Incredibly, the Grattan Institute went on to say: “The people who might live in new housing – were it to be built – don’t get a say.” Which means that people who don’t live in a neighbourhood don’t get a say… but that they should? This dear reader is what passes for a think tank these days).

A housing shortage though is only one of the challenges. Most of the additional “skilled” migrant intake will settle in major cities, where congestion problems are mounting. Our skilled migrants (with a wage floor below the average wage) will not be flashy suit-wearing financial markets or property executives, catching shiny new public transport projects to their high-rise CBD towers from which they can view and rule over the world beneath them. No, they will be “nurses, teachers, aged care and childcare, hospitality, IT and other skilled workers (who) are holding the economy back”.  These workers and the industries they work in are suburban, which means getting to and from work with any semblance of convenience, will involve the private car. For every 100,000 extra people, expect 60,000 to 70,000 more cars on the roads. And given the lower wage profile of our skilled migrant intake, they won’t be driving $65,000+ Teslas, much to the dismay of wealthy inner urban Teals and Greens. No, they are more likely to be driving early model, emissions heavy vehicles – because that’s what they need and can afford.

Another shortage which is hard to ignore is health care. Barely a night passes without another news story dealing with chronic shortages in our health system. Admittedly, some of these shortages are labour related (which skilled migrants will help address) but others are physical – we haven’t been building hospitals in pace with population. This scary graph below from the World Bank suggests that today we have around one third the number of total beds (private and public) per thousand as we had up until maybe the mid 1980s. (What happened in 1999-2000?). Other sources paint a similar picture. Our lower income earning skilled migrants aren’t exactly going to be rushing for a $400+ a month private health cover policy, so you can safely bet a majority will – initially at least – be reliant on an already stretched public system.

Schools too may come under pressure. The public education system has served Australia well but with all major cities now embracing greater population density within existing urban footprints, we will need to find more places for more children in existing areas. Private or independent schools – for the same reason as private health insurance – are likely beyond reach of new migrants on lower incomes. I tried to summarise the challenge in A looming schools shortage?: “Every extra million people (as for example predicted for each of our major capitals in just a few short years) will mean an extra 160,000 students. At a rough average school size of 400 students, that’s another 400 additional schools for each million of extra population.” Finding land suitable for new schools will not be easy.  Happily, teacher-student ratios appear to have held up. The real growth in numbers seems to be administration and related roles (doesn’t that say something) but the pressure of rising demand for student places will surely exert itself soon.

Other more basic services will also be put under pressure. Australia’s energy grid is cracking, with falling baseload generation not yet being met by the promise of renewables. The Australian Energy Market Operator (AEMO) is warning that: “Electricity supplies are forecast to fall short of demand within three years across Australia's eastern grid, unless new renewable energy and transmission capacity is urgently brought online… Central to the upheaval has also been a spate of coal-fired plant outages, which at one stage in June affected a quarter of the fleet in the eastern states. AEMO said those supply pressures were likely to get worse in the coming years as five coal plants closed, taking with them 14 per cent of the National Energy Market's total capacity.”

An increase in skilled migration of course won’t be the reason the energy grid could run short of energy, but it is another reflection of policy-induced supply shortages (much like housing) which are now translating into higher and higher prices (much like housing).

Even one of the most basic commodities of an advanced nation – reliable drinking water – seems threatened with shortages. In fast growing south east Queensland, water utility organisations in 2021 warned in an official report that: “South-east Queensland will not have enough drinking water to support its rapidly growing population amid fears the region’s dams will struggle to supply millions of extra residents.” Building new water storages seems too politically charged, and governments can be divided on the best course of action. For many of our major cities, offshore desalination plants seem the fallback position. If only they weren’t so energy-hungry and could drain what’s left of the power grid. What, you want people to have reliable electricity AND reliable water?

It’s easy to be sarcastic. If only it weren’t true. I am one of those who believes our nation can readily support more people. In many respects, we need more people. But we are proving ourselves increasingly hopeless at it. This is just a cursory scan of some areas where our limited capabilities are becoming obvious. There are arguably many more. Pumping up the population intake at a time of critical housing, energy, hospital and even water shortages, without widely agreed plans to address those shortages, and without a coherent national settlement strategy and instead just jamming more people into already challenged and congested major cities, doesn’t seem like planning to me.

Maybe they need to hold another summit to think about it? They could open it with a reading of what author Donald Horne so acerbically once said? “Australia is a lucky country run mainly by second rate people who share its luck. It lives on other people's ideas, and, although its ordinary people are adaptable, most of its leaders (in all fields) so lack curiosity about the events that surround them that they are often taken by surprise.”

One million more cars: the suburban mobility challenge

“We are excited that we will see another million cars on our roads by 2041, such is the growth our region will experience.”

Yeah, nah. You’re never going to hear a growth booster make that statement. But it’s true. Or at least highly likely. Another 1.5 million people, based on the average ratio of cars to people, will mean roughly an additional 1 million more cars on the roads. Plus more commercial vehicles. Whether that’s Sydney, Melbourne, or South-east Queensland (where the 1.5 million more people is the official 2041 forecast) matters little. Each city has been “promised” very large population gains in a short space of time. With those gains come consequences, in the same short time frames.

We are assured that public transport – usually in the form of heavy commuter rail - will “solve” the rising congestion problem. If you believe that, please share whatever’s in your Kool-Aid, I want some too. Heavy commuter rail works well for centralised workforces. Jobs in CBDs and near-city locations are well supported by this type of public transport. But there are a number of things to keep in mind if you see a bright future in radically expanded public transport of this type being ‘the solution’ to rising numbers of private cars.

First, CBD and near city jobs represent only around 10% of a metro region’s workforce. Heavy commuter rail proponents – including many who support ‘fast rail’ – envisage outlying exurban areas maybe 50 or even 100 kilometres from CBDs serviced by subsidised fast rail than can transport highly paid professionals to their CBD offices in under half an hour. Which is fine if you are among the 5% or fewer of people in outer suburbs with jobs in the inner city. Most inner-city workers live much closer to their workplace, and are already well served by existing public transport. Of CBD workers, around half typically already catch public transport. But of people with suburban work places – who represent the 90% of jobs – this percentage falls to single figures.

Second, the fastest growing industries producing the greatest numbers of jobs are health and education. This is going to continue for the foreseeable future. These are not CBD white collar office worker jobs – they are typically suburban. Which means the fastest jobs growth in our metro areas is likely to continue to be outside the inner cities. And accessing those jobs currently is most conveniently achieved by private motor vehicle. Public transport networks servicing suburban home to suburban workplace journeys are notoriously difficult, (with the exception of buses which can make use of the road network but which still struggle with volumes).

Then there’s been the whole Covid response with what seems a semi-permanent move to CBDs as places of work for maybe three days a week, with white collar professionals using technology to work from home and save themselves the time, cost and inconvenience of the commute. I still think it’s too early to call this a permanent change, but what it has done for now is markedly reduce overall demand for public transport. Cars are in more demand with long wait lists for new vehicles and very high prices for second hand. Is this a long term thing or not?

Some public transport advocates can get quite Bolshie when it comes to private cars. Some suggest they be banned from CBDs altogether and roads converted to cycle and pedestrian thoroughfares. Others promote suggestions that private cars are taxed even more heavily (including through road user charges) to discourage their peak hour use and to support public transport. The latter could work if public transport was a genuine alternative. But go back to my first point: only one in ten jobs of a metro wide region is in the sort of centralised location where PT is a genuine option. And that ratio will likely shrink as suburban jobs grow faster. Banning or taxing cars may go down well with the inner urban professional set who are well served by existing PT networks, or who can ride their $10,000 carbon fibre racing cycles to work on a dedicated inner city bikeway, but it would impose significant and unnecessary hardship on the other 90% of workers.

Also, take into account the changed nature of the journey to work these days. Some years back in the public transport hey-day, city workers left homes at a regular time, commuted to their central office via public transport, and left work to return home the same way. The 9 to 5 commute is no longer. These days the journey to work can mean leaving at a different time every day, a school drop off en-route to work, then gym on the way home and maybe a stop for groceries too. Don’t forget the kids either. That’s very difficult for public transport.

So, what do we do about the prospect of another million cars on our roads? Promising to solve this with visions of fast commuter rail is, in my opinion, unrealistic. Witness the new Moreton Bay rail link in southeast Queensland. Opened in 2018 at a cost of $1.2 billion (over $100m per kilometre), then Treasurer Jackie Trad promised “A project like this … will see 600 new trains go from the Redcliffe Peninsula to the city CBD every week, (and) is a fantastic initiative for workers in this area.” Then Prime Minister Malcolm Turnbull chimed in with “Realistically, someone could jump on a train here in Kippa Ring and use our public transport network to visit the beaches of Gold Coast or Sunshine Coast.”  The trains are running – every half hour even – just few commuters are using them, nowhere near predictions. I caught one last month, from Rothwell to the CBD. Near $10 fare for one way. Lovely carriages, huge platforms. Just empty. Few people in Redcliffe work in the CBD, and if they want to visit the beach, I can’t envisage the beach umbrellas, eskies and other stuff making the trip which involves at least one platform change and a bus trip and, in all likelihood, a two hour exercise. I mean, were they on drugs when they made these statements? 

But enough ridiculing (though it’s tempting with so much material to work with).

One option could be to centralise everything – jobs and social infrastructure. Schools, Universities and hospitals included. Outer suburbs become residential dormitories and their inhabitants are transported daily to their workplaces or for their needs, via rapid transit networks, to the city centre. This urban model was well portrayed in the series of movies “The Hunger Games.” ‘The Capitol’ was where all the high-quality amenity was concentrated – the best jobs, the most wealth, the finest dining, cultural and other facilities, enjoyed by a highly privileged elite whose lives were totally removed from those of the ‘Districts’ where impoverished worker drones lived. Great movies. Like Sim City on ‘roids from a planning sense. But maybe not something to aspire to (even if Sydney seems to be heading that way).

What else? We could try slowing the growth rates. Our rates of projected growth in our three larger cities are, by world standards, very ambitious. It’s not the quantum, but the speed. Growing faster than even Beijing or Shanghai ought to ring alarm bells. Realistically, history and experience shows we are just not very good at it. We have proven more or less capable of housing a rapidly growing population (though the wheels are falling off even that cart now) but when it comes to infrastructure like transport, hospitals, schools – we haven’t much to brag about. Perhaps slowing the population growth to a safer speed – one we can keep up with - is an idea?

 

We could also invest as much energy and thought into the future of work and workplaces. Much regional growth planning seems fixated on housing, and maybe the provision of schools. But there could be more discussion about how we support more opportunities for jobs and industry near where future populations will live. Jobs closer to homes allows for shorter commutes and potentially reduces congestion caused by lengthy trips, or trips in one direction. The fast-emerging post Covid economy will be shaped by tech and new and emerging industries along with high growth industries like health and education. If we did as much planning for distributed suburban hubs as we do for inner cities, we might find the investment pays dividends. 

More time thinking about the alleviating benefits of autonomous, electric travel might also be handy. This technology is already with us, it just hasn’t been widely deployed yet. Instead of every million people requiring 600,000 to 700,000 cars – most of which sit in garages for 20 hours of the day going nowhere – the prospect of not owning a car but having access to an on-demand fleet of hybrid private-public transport vehicles is something we could be thinking more about?

Buses and hybrids (like Brisbane’s Metro) could also be worth expanding – on the basis that making use of the existing road network is a more flexible and much cheaper option than fixed heavy rail tracks, fixed heavy rail stations and fixed overhead power lines.  This handy video summarises a number of trackless tram initiatives around the country (though very strangely leaves out Brisbane’s metro which is arguably far more advanced).  

We could also make better use of existing infrastructure including the heavy commuter rail network. Existing suburban train stations are commonly viewed as potential high density housing hubs so that city workers can commute to their city jobs. But what about viewing these also as potential destination stations, surrounded by higher density employment zones? Or schools? Or community facilities? Some stations offer ample surrounding land for this to occur. Moving away from a centralised view of the economy and transport to one that encourages dispersed employment nodes around suburban hubs seems critical to maximising the infrastructure opportunities we already have.

Way over the word limit on this one, but a big topic that could deserve a lot more thought and open-minded discussion. For those interested in delving into some of the evidenciary background, the references below are handy.

 

ABS Census on Journey to Work (2016 data)

https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/2071.0.55.001~2016~Main%20Features~Feature%20Article:%20Journey%20to%20Work%20in%20Australia~40

 

JAN 2022 UPDATE ON AUSTRALIAN TRANSPORT TRENDS – CHARTING TRANSPORT

https://chartingtransport.com/category/mode-share/

 

The MIT Mobility Initiative, a collaboration between the School of Engineering and the School of Architecture and Planning, is designed as a platform to connect all mobility and transportation activities at MIT, building an integrated approach for the Institute’s efforts on research, education, entrepreneurship, and civic engagement related to transportation systems.

https://dusp.mit.edu/news/global-resource-better-mobility-systems

 

Suburbia as we want it. Not how we know it.

Covid accelerated a global trend that long predated it: an awakening appreciation of what our suburbs offered, and the potential for their renewal. Heightened interest in our suburbs should be no surprise - after all, it is typically where more than 8 in every 10 urban dwellers live and work. But many suburban centres in Australia lack the readiness to attract and retain talent, or capital. This underinvestment manifests itself in many guises: abundant ‘For Lease’ signs, congested traffic, net local job losses, legacy land uses… we know intuitively what it looks like; it’s sadly too familiar. So if this is much of suburbia as we know it, what might suburbia as we want it look like? And what will it take to get there?

Suburban Futures’ vision is for progressive cities where quality social and economic infrastructure is equitably distributed across both suburban and inner urban locations. It is one thing to say this, but another to describe what it means. And given the best descriptions are visual representations, Suburban Futures went about trying to illustrate what we meant by suburban renewal, using 3D renders. The visual illustration isn’t intended to be definitive – simply to fire imaginations and highlight the possibilities.

First though, we needed to describe a “before” renewal scenario. For this, we engaged a talented young landscape architect who was a maestro with Sketchup (ask for Emily at Partnear) and went about creating a hypothetical run-down suburban strip centre that could be anywhere in Australia. This was a mash-up of many features of suburban strips that are immediately recognisable: the empty lots, the busy traffic, the visual pollution, the for-lease signs and vacant shops, the lack of occupancy above street level, the abandoned saw tooth industrial and other buildings, the streetscape hostile to local pedestrians and cyclists, a lack of parking, the old pub with the pokies, the low-end used car yards, a landscape of concrete and bitumen, pawn shops and vaping stores. It isn’t hard to let your imagination loose, so we did. Ironically many people have remarked that they claim to recognise this fictional environment as somewhere near them. It isn’t, but the fact it looks familiar is sad.

Describing what successful renewal might look like took more effort. The visuals in the transition from “before” to “after” do much of the work but what we aimed for was a shopping list of suburban renewal initiatives, to illustrate the variety of options available to explore.

In our hypothetical makeover, through traffic – commercial and private - has been diverted underground via a tolled tunnel. Active transport (walking and cycling) is provided for, as is local off-street parking (via a multi-deck paid parking station on the left). The train station (hinted at in the “before” image, front left) is now integrated into a new building with retail on ground and co-working offices above. The abandoned saw tooth industrial sheds (midway back on left) have been re-imagined as a combination of farmers markets and workplaces, while the structure itself was largely retained as exercise in adaptive reuse. In the distance (right side) there is a new TAFE building, and in front of that the pub has added new levels to provide for short term accommodation. The pokies are still there, but so too a new restaurant and meeting rooms. There is a pocket park next to a Council Library, and a childcare centre. In front of these there is a medical centre and also medium density residential. Health and education uses were deliberately targeted as drivers of suburban jobs and attraction, along with other community and social infrastructure (park, library etc) to cement the function of the centre as a commercially valuable community asset.

(You can view the mid-point changes by using these two QR codes – one for the left and one for the right side).

The overall landscape has been softened with extensive plantings and the overhead power and telco lines placed underground. Building heights are mostly four to six stories, and designs vary from one to the next. The answer to the question: “Where would you rather be?” – the before or the after - should be unanimous.

Getting here is another thing. Results like this require cooperation between Federal, State and Local Governments in order for infrastructure strategies and delivery to be appropriate and efficient. One look at how difficult it’s been to get “City Deals” over the line will indicate this isn’t easy. State and Local Government planning regimes also need to work together, rather than pursuing differing objectives for the same precinct, as can sometimes be the case. A big challenge is removing unhelpful planning codes and legacy zonings which reflect past uses or precinct history, in order to enable a wide mix of new uses to take root organically, without needless obstruction.

For redevelopment to occur, the prevalence of typically fragmented property ownership is also a challenge. Many will be small sites, held by private owners with little capital to redevelop themselves, but equally unwilling to sell into amalgamations. This means that larger sites with transformative development potential are critical and need as much planning and regulatory support as possible. As with inner urban renewal, the larger sites are redeveloped first, paving the way for a range of niche infill sites to follow, which helps create neighbourhood character. It can be healthy for a multitude of developers and designers to be active in a precinct, as this avoids a homogenous look where the entire precinct looks like it was part of a single design.

A renewal precinct needs many of these things to happen first to overcome tenant and community hesitancy. That can mean a different risk profile to investing or developing in established precincts or markets, which once again suggests a planning or regulatory environment that helps mitigate risk in suburban renewal areas is going to be essential. Even then, the basic financial equations of achievable rents relative to development costs, needs to stack up. Government agencies prepared to pre-commit (taking some office space or committing to a library or some other form of activation) can mean a lot but is often hard to achieve.

With so many hurdles, many would feel entitled to ask whether it can even be done. The answer is that we have already done so. Many inner-city areas, only 30 years ago, were run-down legacy industrial or housing precincts, subject to increasing signs of urban decay. Like many suburban centres today, there were empty buildings, a plethora of ‘For lease’ and ‘For sale’ signs, dwindling capital values and an exodus of jobs and residents. The Federal Government’s “Building Better Cities” program (1991) began a turnaround which has renewed the life of inner cities, many which now boast the highest real estate values and vibrant employment markets.

It has also been done in some suburban centres. Nundah Village in Brisbane was transformed by a $50 million State funded ‘cut and cover’ road bypass tunnel to alleviate local congestion, $3m in suburban street improvements by the Council, and a range of planning changes which encouraged new investment. The result? More than $800 million in new private investment, a fall in commercial vacancies to under 3%, 1,550 more jobs (many of them professionals, including medical) and nearly 3,000 new medium and high-density dwellings. Where people were once ashamed to admit they lived near Nundah Village, it is now seen as a selling point. That is an impressive ROI.

Suburban renewal is just as economically lucrative as inner urban renewal has proven. As we look across the landscapes of our cities into the future, the promise of vibrant, energetic suburban centres offering work and community facilities closer to where people live, and with amenity standards equal to those in the inner city, isn’t just an enticing prospect - it’s a necessary one.

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A looming schools shortage?

As our population grows, so too will demand for school places and new schools. This is going prove a significant driver of demand for space - especially in suburban centres. But first, old thinking about schools needs to change to allow for the opportunities that the future presents and to avoid an inevitable shortage of places in suitable locations.

First, some quick numbers. There are just over 25 million Aussies in Australia. Of that, some 4,030,717 were school age students enrolled in 9,581 schools. Based on that ratio, every extra million people (as for example predicted for each of our major capitals in just a few short years) will mean an extra 160,000 students. At a rough average school size of 400 students, that’s another 400 additional schools for each million of extra population.

In South-east Queensland, official forecasts suggest another 1.5 million people by 2041, which is another 240,000 school age kids in need of an additional 600 schools. That’s the equivalent of 31 new schools in SEQ each year for the next couple of decades.  Sydney and Melbourne will face similar predictions.

It’s not just students. The education sector is a major employer. It employs 1.153 million people nationally, 62% of whom are full time workers. That’s nearly one in ten of the national workforce.

It’s also the third fastest growing industry in the country, predicted to add another 150,000 jobs in the five years to 2026. Some 93% of those jobs will be in suburban places. (The fastest growth industry of all in health care and social assistance, of which 90% will be based in suburbia while professionals are second fastest with three quarters outside inner cities). The figures in red in the graph below show the percentage of these jobs in suburban areas, against the numbers of new jobs predicted (in blue).

Of those education jobs, the majority will likely be in school age education, based on current shares:

Government schools account for 65% of enrolments while Catholic schools account for 19.5% and independent schools for 15.4%. In the independent schools area, there are a plethora of smaller schools providing for particular faiths, cultures, learning needs or other specialisations. For example, more than half (54.6%) of the independent schools in Queensland have enrolments of under 500. One in ten have enrolments of less than 50, and a further one in ten enrol between 50 and 100. One in five have enrolments of 500 to 1000 and only 6% had enrolments above 1500.

So, it’s a very big industry which is growing fast in line with predicted population growth. It is going to need additional school places and many more new schools, and nearly all of these will be in suburban locations. Not all will be large schools though, many with smaller space needs. How do we meet this demand? How do find the sites?

The traditional school model that comes to mind is the large primary or secondary school with a cluster of low-density buildings and its own sporting fields. In most suburban areas slated for infill (to absorb increased population) there simply are not sites of this size anymore. The government sector is struggling to find new sites for traditional school models – even resorting to proposing they are built in known flood areas.

There are possible exceptions. For example, oversized carparks provided for at new train stations could easily accommodate a modest sized school. Being next to a train station for students and staff is both logical and appealing. In the absence of hordes of commuters embarking at outer suburban stations destined for CBD offices, why not use the infrastructure as a disembarking point for school kids? This will require new thinking – something we’re not good at. (The example below is Murrumba Downs station on the relatively new Redcliffe Peninsula line, with ample room for a school).

Repurposed industrial land also presents a similar opportunity (once any hazardous contaminants are safely dealt with). Many industries have moved out from older style areas with narrow streets and smaller buildings to new industrial estates with b-double friendly road and transport networks and buildings designed to meet contemporary needs. The legacy sites can struggle to find new uses beyond low-grade storage. A wide mix of uses - education included - should be on the list of future possibilities. 

However, in most cases infill school sites are near impossible for the traditional large school + playing fields format. There is no reason however why any number of existing suburban centres – especially those near transport infrastructure, cannot be re-imagined. Vacated big box department and discount department stores offer ample space for modestly sized schools, potentially integrated into the shopping centre. They are typically well located, provide ample parking, are near public transport and have traditionally hosted intensive uses. The term ‘shopping centre’ has passed its use by date anyway; they are more like community centres now, for which uses like health and education make much sense. This is being done in the US, and there’s no reason it can’t happen here, other than planning flexibility, political will and industry intelligence (all three of which are often sadly lacking).

New mixed-use projects and entire renewal precincts could equally benefit from the activation that a school provides. Remember, a school of 50 to 100 students isn’t a candidate for a standalone building with its own sporting fields or gymnasium anyway – they instead could be a tenant within a new or adaptive re-use project, making use of nearby parks or commercial gyms should the curriculum require it. Once again, rigid planning controls that limit the type of mixes allowed in a mixed-use project typically don’t include education by default – something else that needs to change.

Funding options too are not necessarily the obstacle that you might think. Given the ravenous appetite of capital and the sheer weights of money looking for sustainable long-term investments, there is no reason why institutions won’t enter the education sector as a long-term capital partner on the non-government side, (potentially even the government side if they could). Where a non-government school once needed to save capital to fund land acquisitions and building costs via generations of savings and fund raising drives, we may soon see a number of these schools enter into new campus arrangements funded upfront by institutions on very long-term lease back arrangements. Think it can’t happen? Have a look at how quickly funds have begun entering the private health space, funding its (largely suburban) expansion? Private capital is already partnering with the tertiary education sector to fund new campuses – why not schools as well?

The bottom line is that with population growth comes the demands of that population – and schools are at the top of the list, or very near it. Our traditional approaches to locating schools will have to change if infill strategies to soak up growth are to work. This will require some forward thinking from urban planners and policy leaders. Any delays will inevitably result in a shortage of spaces, with overcrowded classrooms and limited choices on the government side, and even more exorbitant costs as demand exceeds supply on the private side. We made a mess of the housing market by failing to plan ahead. Can we avoid doing the same to schools?

 

References:

Education sector profile: https://labourmarketinsights.gov.au/industries/industry-details?industryCode=P

Labour market profile: https://lmip.gov.au/default.aspx?LMIP/GainInsights/IndustryInformation/EducationandTraining

ABS Schools data: https://www.abs.gov.au/statistics/people/education/schools/latest-release#covid-19-in-this-publication

Independent Schools Queensland: https://www.isq.qld.edu.au/publications-resources/categories/research/

  

From factory to free-range offices. At a price.

Last week, leading Australia developer Mirvac called for an overhaul of what it called “outdated metrics defining office spaces.” The call was in response to new, hybrid modes of work and new workplace design in the wake of the Covid pandemic.

Mirvac is right to explore new office metrics. The current building grades categories, methods of measurement and methods of calculating vacancies and occupancies are little changed in decades. They have served the industry well enough but come from an era of factory mode office work, with workers dutifully lined up at their cubicles, all arriving at the same times and mostly leaving at the same times. Those days are gone.

To quote from the story in The Australian:

“(Mirvac head of integrated investment) Campbell Hanan argues for the need for a different system of measurement of office values as both the nature of work and what draws tenants to buildings has changed.”

“There’s a new paradigm coming now, which is all around experience, because there is a whole new adaptive way of work that’s happening,” he says.

“He cites British developer Sir Stuart Lipton’s remark that offices will go “from factory farming to free range”. This will prompt a change from a sea of workstations to more open, collaborative spaces, which should be recognised in building values.”

“He says tenants going into next generation buildings are focused on issues ranging from ESG concerns, employee experience, and post-pandemic concerns about air circulation and managing spare desks.”

No doubt he’s right. To attract key workers back, the new workplaces will feature building service upgrades embracing an array of embedded technology, HVAC and environmental features not seen in typical worker drone office buildings. There will be more outdoor spaces, garden terraces, lounges, recreation and exercise areas. The notion of offices with an average of 8m2 or 10m2 per person is gone from this new office nirvana. You are looking at more like 20m2 per person (a historic average by the way, before we let accountants define our workspace needs).

That space is also going to be costlier to build. Added to the recent general escalation in building costs, and developers of this new breed of office are going to need to do their sums even more carefully.

But it’s potentially worse for the occupier. A simple back of envelope comparison suggests the two big variables will be the fit out cost, and the number of people per square metre. If an occupier moves from a typical ‘A’ grade building with basic fit out and 10m2 per person, to a premium “new” design for the post covid world with much higher fit out costs and fewer people to the square metre, it is conceivable that real estate costs per person could nearly triple.

(No, in this example no allowance is made for post-tax fit out depreciation or rental incentives or other deductions. Fit out is simply divided by 6 on a six-year lease basis, as many tenants are reportedly looking for shorter, more flexible terms. Very basic and hypothetical numbers for illustrative purposes only).

 

How will the market respond to this? Would traditional “paper factory” tenants with legions of administrative and support staff be comfortable with a real estate cost per person that is close to half the salary of many of its workers? Or would they elect to split their workforce into the “worthy” higher value employees for the new CBD premises, while admin and support staff are encouraged to continue working from home, or from a distributed low cost hub?

Does it mean a likely bifurcation of the market, as predicted by Mirvac’s Haan who said “We’re going to need to value it because there will come a time when some buildings which offer unique experiences compared to others, are going to attract valuation premiums.”  Which also means lesser buildings will be discounted.

In turn, does that mean new opportunities for tenants to negotiate rents in less prestigious buildings, leading to lower occupancy costs for a wider cross section of CBD occupiers who are content with the older style office factory. Is the problem here that while the older style low-cost office may appeal to the business, it may not appeal to that business’ workers?

The magnitude of changes are hard to get your head around. Reluctance to return to the pre covid mode of work seems – for the time being at least – unlikely to change. Bloomberg City Lab reported this week that: “The average New York City office worker intends to reduce time in the office by 49% and slash annual spending in the city by $6,730, down from an estimated $12,561 before the pandemic, according to Nicholas Bloom, an economics professor at Stanford University.”

(There is a good PowerPoint on the latest WFH research by Stanford Professor Nicholas Bloom, which you can find here).

Meanwhile, on the west coast USA, Apple workers are reportedly rejecting mandates to return to their $5 billion new, futuristic, purpose built headquarters in Cupertino. That mandate is hardly intimidating. According to New York Post, “Apple CEO Tim Cook is ordering all corporate employees back into the office at least one day per week beginning on April 11. The mandate ratchets up to two days per week on May 2 and three days per week on May 23.” But that’s enough for some to exclaim: “I don’t give a single f—k about ever coming back to work here…  I’m going to go in to say hello and meet everyone since I haven’t since I started and then sending in my resignation when I get home,” the employee wrote. “I already know I won’t be able to deal with the commute and sitting around for 8 hours.”

All this seems to point to CBDs becoming even more conspicuous as places for the high-end professional class, who (by virtue of living closer to the CBD in higher price housing) already enjoy shorter commutes than the worker drones, and who may also soon be offered more lavish workplaces to entice them back to work in even more highly valued buildings. Meanwhile, reluctant worker drones who once spent hours commuting to a computer screen in some anonymous cubicle, may rarely venture back. CBDs, which were once intensely active centres of employment for everyone from lowly clerks through to managing directors, may become even more concentrated centres of privilege and power. No more factory hens but instead free-range chooks. Plus an awful lot of roosters?

Comedy can be a great tool in drawing out the irony of changes like this. This British sketch is a pearler.

The delusion of the illusion

Rational, balanced, evidence-based policy left the room long ago. In its place, it seems all you need now is a clever looking infographic posted to social media, and you’ll be getting “likes” from thousands of professionals and community members already persuaded to a particular agenda and “wanting to believe.” Very few bother to question sources, motives, or logic. As US President John F Kennedy so famously said: “We prefer the comfort of opinions without the discomfort of thought.”

One recent example is this infographic, posted recently to Linkedin. Predictably, it’s received a lot of likes and “thumbs up” – including from some academics who you might imagine are trained to be sceptical. The infographic is effective and simple. The message is clear: one train equals 625 cars. Trains are good, cars are bad.

The source of the graphic has been cropped by the poster, but it was easily discovered thanks to Google. The origin was Seattle Subway (logo cropped bottom right). At first I thought this might be a public transit authority, but a further search revealed Seattle Subway is an “all-volunteer, grassroots organization dedicated to promoting high quality transit for Seattle and the Puget Sound Region on the fastest possible timeline.” So it’s a public transport lobby group. Nothing wrong with that at all, but being a lobby group means the infographic is suspect: it’s designed to promote their point of view, and their point of view only.

Plus, you could also question the extent to which transport circumstances in Seattle, Washington State, are comparable to Australian cities. The population of Seattle is 755,000 and it has enjoyed reasonable growth in public transport up until 2018/19. The public transport mode share was an impressive 23% of trips. But that’s within the Seattle City boundary. The greater Seattle metro area is home to 3.46 million people. The public transport mode share for the wider region is just 10%. And like cities the world over, public transport use has been adversely affected by Covid, and mode shares may take time to recover.

That’s enough for the source of our mis-information graphic. Now to the logic.

First, it assumes a four carriage train is 100% full, while 625 cars carry 1.6 persons on average. If cars were at capacity, they could carry 4 or even 5 people each. Meaning more like 250 cars applying the same occupancy logic. Not 625.

The buses must be big too. 15 buses for 1,000 people means 67 people per bus. Australian commuter buses carry around 44 seated. So the buses in this mis-infographic are also absolutely chockers.

But maybe the biggest fail in logic is the presumption that all 1000 people are leaving from the same place and going to the same destination. Trains are fixed route transport modes, with fixed stations and fixed schedules. They are the opposite of what we all do – varied routes, varied schedules, and often multiple destinations in the same trip (school drop off, work, gym, grocery store etc). The likelihood of all those cars and their passengers heading for the same destination and taking the same route as the people on the train, isn’t just remote but fanciful. That alone renders the mis-infographic closer to propaganda than anything else.

But simple messages are effective, and this flawed logic finds much support – especially amongst politicians who wilfully champion mega spending on transport projects that promise much but deliver little. Witness the latest Federal Budget which promises $1.6 billion toward the cost of a Beerwah to Maroochydore rail extension. The State Government needs to match that with another $1.6 billion. Perhaps tongue in cheek, the Courier Mail reported it would be “full-steam ahead on major rail projects” under the budget. Project enthusiast MP Ted O’Brien claimed “It will get people out of cars and onto trains.”

A couple of years ago I presented on employment trends to the Sunshine Coast Business Chamber, who were also enthusiastic supporters of heavy commuter rail. Except that (according to the Census) of the nearly 300,000 total residents, 140,000 were in the labour force and of these, only 2,739 commuted to inner Brisbane where the rail would take them if it existed. 101,000 worked locally (within the Sunshine Coast), 5,000 in neighbouring Noosa, 4,000 in neighbouring Moreton Bay and a further 2,900 in the balance of the Brisbane region.

So we could see another several billion of taxpayer funds invested into another heavy commuter rail project to take unimpressive numbers of commuters via fixed routes to fixed destinations on fixed schedules, when all about us life is heading in the opposite direction.

It wouldn’t be quite so bad if there was hope that someone was doing the practical research work on the future of autonomous, electric vehicles, more efficient use of existing road networks, micro mobilities, permitting jobs closer to where people live, the potential of drone delivery to reduce last mile delivery traffic, or other initiatives, on a bi-partisan and evidence-based approach.

Maybe what that needs is a clever infographic?

Is suburbia’s global benchmark share of urban jobs 87%?

“The great enemy of truth is very often not the lie--deliberate, contrived and dishonest--but the myth--persistent, persuasive, and unrealistic. Too often we hold fast to the cliches of our forebears. We subject all facts to a prefabricated set of interpretations. We enjoy the comfort of opinion without the discomfort of thought.”

That was from a speech by former US Democrat President John F Kennedy, while at Yale in 1962 and prior to entering politics. I came across it during a visit to the Kennedy Presidential Library in Boston a few years ago. How true it still is.

The myth of the centralised urban economy is certainly persistent, persuasive, and unrealistic. It qualifies as opinion unchallenged by uncomfortable thought. It is also subject to prefabricated interpretations. It goes something like this: CBDs are where the majority of people work. Therefore we need planning that reinforces a centralised economy and we need to prevent people living far away from CBDs, instead providing more housing nearer to the centre – because this is where the jobs are and where everyone wants to be if they could.  Attracting more jobs to a metro region is best done by ploughing more taxpayer dollars into CBD amenity, or into transport networks that serve the inner city. That simplistic outline crudely (and sadly) sums up too much of what passes for urban planning orthodoxy.

Census after census has proven this wrong. In Australia, the CBD share of metro jobs in major cities is between 10% and 15%. In the smaller capitals it falls between 15% and 20%. (It is also shrinking because the suburban economy is growing faster than the CBD, thanks mainly to industries like health and education). How does our CBD share compare on a global scale? Some argue that Australian cities need more centralisation to be efficient. Compared with what?

Comparing Australian cities to some global benchmarks is an interesting exercise. A study of around 100 cities in Australia, Europe, Asia, Canada and the USA tallied more than 300 million metropolitan jobs. Of these, under 30 million were in CBDs. The average was 9%. But these were mostly 1990 data, and some of the cities were not very comparable to Australia. So I selected a slightly more comparable list and updated the data to around 2016 to 2020 numbers. For Australian cities, the CBD was the 2016 Census SA2 boundary while the Greater Metropolitan area was used for the whole. While the numbers will have changed, the proportions won’t have changed much, so it’s useful as a guide.

Based on this selection, the average CBD share of metro wide jobs for a city in a modern western economy is around 13%. Not 30% or 50% or 60% but 13%. Meaning globally some 87% of people living in cities of substantial scale and with substantial urban economies, do not work in the CBDs but are more likely to be found working in suburbs.

Sometimes, in efforts to bolster the numbers to favour the centralisation narrative, the definition of a CBD is enlarged to something like a 5 kilometre radius – which in most cities reaches very much into suburbia. While it is true that CBD boundaries don’t fully reflect the extent of near city employment, it is also true that metro boundaries don’t fully reflect the boundaries of suburban employment. Too often the inner city is broadly defined and the outer urban narrowly defined. Do both, and hey presto you can prove anything with statistics.

So the myth of the centralised economy lives on. It is an enduring urban fallacy which is rarely investigated. Increasingly, government budgets seem to favour inner cities over suburban domains where the vast majority of a city’s residents – more than eight in every ten - live, work and play. This is leading to a new class divide not based on occupation or education, but on geography.

Interestingly, the global data has also been pointing to an organic decentralisation of urban jobs that preceded Covid. Academics like Prof Ed Glaeser (Harvard), Prof Peter Gordon (Uni Southern Calif), Joel Kotkin (Chapman University), Alan Berger (MIT), Samuel Abrams (Stanford), William Frey (Brookings Institute), Schlomo “Solly” Angel (NYU) and others have all observed the data on jobs and housing was for some time prior to Covid saying something very different to the conventional narrative.

“The combination of city growth declines and higher suburban growth suggests that the “back to the city” trend seen at the beginning of the decade has reversed,” said Bill Frey. (Big city growth stalls further, as the suburbs make a comeback – Brookings Institute 2019).

“We found that, on average, only 1 out of 12 people live and work in the same community; only 1 out of 9 jobs is still located in the CBD; and only 1 out of 7 jobs is located in employment sub-centers outside the CBD,” said Schlomo Angel in The spatial structure of American Cities (Science Direct. Jan 2016).

“Contrary to perception, the nation is continuing to become more suburban, and at an accelerating pace. The prevailing pattern is growing out, not up, although with notable exceptions,” said Jed Kolko in an article entitled “The Myth of the Return to Cities” (New York Times, May 2017). Jed was last year appointed Under Secretary of Commerce for Economic Affairs by US President Joe Biden.

Covid, or more correctly government responses by way of lockdowns and work from home mandates, has evidently accelerated that movement of people and work toward the suburbs and regions.

However, don’t expect the myth to quickly evaporate. There is much at stake: professional and academic reputations, industry group agendas, government budgets, plus the beneficiaries of inner urban favouritism – the higher income earning inner city dweller who is now revelling in the ownership of the most expensive real estate surrounded by the best amenity, paid for by taxpayers, most of whom live and work in much less salubrious suburban or regional environments. Anyway, to actually think about things rather than look for confronting evidence and think it through, can be uncomfortable, as JFK observed some 60 years ago this year. And we all enjoy the comfort of our opinions more than the discomfort of thought.