How much housing can brownfields sites supply?

Examples of former industrial zoned sites now currently zoned residential. Images in clockwise order: Cardinia, Mornington Peninsula, Maribyrnong and Kingston (graphic from DPCD)

Governments like to point to disused industrial sites as a significant source of land for expanding housing supply within the established suburbs. Only recently, for example, the Victorian Government talked up the potential of Melbourne’s Fishermans Bend as a new “Growth Corridor”.

So-called brownfields sites can make a useful contribution to housing supply but the available evidence suggests their potential is over-stated. One of the risks of taking too-optimistic a view of brownfields is that the formidable obstacles to other sources of supply – like higher density housing in activity centres and infill developments – will tend to be neglected.

The potential of brownfields sites is limited by a number of factors. They might be in locations that are unattractive to the market (e.g. deep within an industrial area) or are expensive to service. Some have been contaminated by industrial processes and it’s possible another use might be preferred over housing.

Challenge Melbourne, the discussion paper prepared to kick-off the Melbourne 2030 process, estimated brownfields sites could contribute 65,000 dwellings over the period 2001 to 2030. While useful, this was well short of the estimated number of new dwellings that need to be constructed – for example, the latest edition of Victoria in Future projects the number of households in Melbourne will grow by 825,000 between 2006 and 2036.

Now the Planning Department has produced a new study which throws further light on the likely contribution brownfields sites could make to housing supply in Melbourne.

The department estimates more than 400 ha of industrial land was rezoned from industrial to residential in Melbourne over the last ten years. The exhibit shows new housing constructed on former industrial sites in Cardinia, Mornington Peninsula, Maribyrnong and Kingston.

That’s an average of 40 hectares each year over the last ten years. If each hectare was developed at a net density (say) of 20 dwellings, that would mean brownfields sites have contributed on average 800 dwellings p.a. to Melbourne’s housing task.

Compared to Victoria in Future’s projection that the number of households in Melbourne will grow by an average of 27,500 p.a. between 2006 and 2036, that 800 dwellings p.a. seems a decidedly modest contribution. In fact, it’s not certain that rezoning always leads to development and, where it does, what proportion of the site is used for housing. Many of the lots identified by the Department are in suburban locations so even my assumed net density of 20 dwellings per ha might be optimistic.

There are of course other non-industrial sites that could potentially be used for housing. For example, a major housing development was proposed for the former Coburg High School site in Bell St (although it appears to have fallen over). The trouble is there are likely to be many fewer such sites available than industrial sites. I’m not in any case aware of an estimate of their likely supply potential and the associated timing.

I applaud DPCD for producing this new study. There are still many questions around the supply potential of brownfields and other major sites, so I would like to see the department continue with this work. As it stands, the existing evidence suggests the Government should be very wary about over-selling the contribution brownfields can make to housing supply in Melbourne.

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