_‘New’ Activity Centers Set for High Density Development

Earlier this week the Victorian State Government announced plans for its new ‘Activity Centre Program’ which will provide 50 new high-density zones around train stations and tram stops, which could significantly change the urban landscape of Melbourne, as a strategic move to address the current housing crisis.

The high-density zones are intended to enable taller residential buildings, between three and twenty stories, to be constructed in the newly identified activity centres to enable the construction of an additional 300,000 homes by 2051. 

Victorian Premier Jacinta Allen announced the first 25 activity centre, as shown below, with an addition 25 expected to be announced by the end of 2024.  The allocation of these activity centres was determined based on the advice of the Department of Transport and Planning based on proximity to public transport, jobs and services. 

(Source: Victorian Government)

Interestingly, the Government is apparently looking into developer contributions in those activity areas, to fund community facilities like open space, schools and so on.  The press talk thus far is about a developer levy rather than a development contributions plan or similar but we are yet to see any detail. 

For years planning strategy studies for greater Melbourne have been calling for more housing to be provided in the inner and middle rings of its metropolitan area, to address housing demand needs (now commonly referred to as the ‘housing crisis’ or ‘affordability crisis’) and this recent announcement appears to finally be seeking to address this long-term and growing issue.  Nevertheless, two problems are already emerging or re-emerging: the political backlash against higher density “in my back yard”; and the need to continue to educate Melbournians on higher density living to ensure any new supply is viable / saleable. 

The state of the housing crisis in Melbourne and across Australia is real and needs Government action.  Should existing residents continue to have the right to thwart planning-appropriate alternative housing in activity centres based on good public transport?  Subject to the detail, this is an approach that deserves support. 

One cannot be concerned however, that at the same time the activity centres are announced, the State Government is proposing major urban extensions on the fringe – is this a balancing of supply or a fallback option if the politics is too hard?

The next year or two should provide some clarity.