A conversation with Suburban Futures’ Ross Elliot.
Ross Elliott has had a distinguished career in the property industry with a background in construction, design, project management, engineering, economics, and development. He is recognised for his expertise in urban development and is Chair of the Lord Mayor’s Better Suburbs Initiative and on the National Executive Committee Urban Land Institute (ULI).
He is also the Director of Suburban Futures, a not-for-profit collaboration of individuals and organisations established to highlight the critical role that Australia’s suburbs and regions play in the economy and liveability of the nation.
In early November, Suburban Futures held its, Future of Suburbia IV conference, focussing on a series of case studies on suburban renewal projects. I spoke with Mr Elliott in the weeks following the event.
I asked first how he sees the relative roles of inner and suburban Brisbane.
“They are two very different markets and two very different communities of interest. Over the last twenty-five to thirty years, there has been a focus on urban renewal, and most of that effort has gone into inner urban areas.”
Pointing to The Powerhouse in New Farm and the wool stores at Teneriffe, Mr Elliott says the focus on urban renewal in Brisbane has been recognised globally.
“It’s a fantastic story to tell. But it also means that these areas were gentrified 20 years ago when New Farm and West End were not expensive places to live, but they are now some of the most expensive places to buy real estate. They’re also communities with some of the highest incomes. One in four in New Farm and one in five in West End earn more than $4,000 a week. That’s very different from what you’ll find in Greenwood, Stafford, Lutwyche, and Virginia.”
Mr Elliott says there is a misconception that everyone works and desires to live in the inner city, cautioning against overlooking that a majority—eight or even nine out of ten individuals—commute from suburban homes to suburban workplaces.
“Living in the inner city would be utterly impractical for them. So, the two are very different communities of interest, and they need to be different.”
To address the disparities, he said, initiatives like Suburban Futures and the Lord Mayor’s Better Suburbs program aim to extend urban renewal principles to the rundown areas in suburban precincts. The objective is repurposing old, unused industrial properties into modern mixed-use areas. Mr. Elliott cites the Yeronga Paint Factory proposal as a prime example of successfully applying these concepts in suburban settings.
Suburban Futures in Chermside
Mr Elliott says Chermside is an excellent example of a suburb that is ripe for renewal.
“It has been in every edition of the SEQ regional plan since the first one was released in the late 1990s; Chermside was identified as a regional business centre, along with Indooroopilly, Carindale, and Upper Mount Gravatt.”
Mr Elliott says Chermside has all the right ingredients for urban renewal, with a significant open space area at Merchant Park, a creek corridor, hospitals and day surgeries, and an associated health workforce.
“There are a lot of positive ingredients. But the problem is we’ve never had much strategic investment into Chermside to help it realise its opportunity as a Regional Business Centre.”
Chermside urgently requires a traffic solution, Mr Elliott said, and Suburban Futures has advocated for a tunnel to alleviate congestion. Drawing parallels with the successful Nundah bypass, he emphasises that the tunnel addresses traffic concerns and provides surface-level opportunities.
Mr Elliott highlights the transformative impact of the Nundah project, where a $60 million state investment led to an $800 million development, creating homes and workplaces and improved local amenities. He stresses the need to decentralise, envisioning Chermside as a future hub with 50,000 jobs, reducing citywide congestion.
Has COVID changed things, particularly place of work?
“No. What is happening with the change of place of work was happening before COVID. The reason goes back to the late nineties and the late eighties when I was a real estate market researcher. The growth industries back then were things like finance, property, and business services, and they were the industries that required CBD office buildings and that explains the big spurt of growth we saw in CBDs. But in the last decade or so, health and education have been the big growth industries, and they don’t need CBD office buildings. They are located by their very nature in suburban places. It has meant that the nature of the economy has become much more dispersed, enabled by technology of course.”
“COVID accelerated our awareness of those changes. But once again, the whole work-from-home thing was valid as an opportunity for people who worked in CBD office buildings in professional roles. It’s not valid for education workers, allied health workers, or people in retail or hospitality. So, for 90 per cent of the economy, working from home is not a thing, … as I said before, we must be careful not to presume that what works for the inner city is typical of life across the city.”
You have argued that we can’t build our way out of the housing affordability crisis. You also argued that the market supply of high-density housing concentrates in affluent city locations, exacerbating affordability.
“I said in that article you can’t use apartments to build your way out of the affordability issue because, by their very nature high-density apartments are the most expensive form of housing. Relatively average two-bedroom units would need to sell for $1 million to cover construction costs, land taxes and all the rest of it. “
“Not a lot of people have a million dollars to spend on a two-bedroom unit, and that’s why we’re seeing the supply of that sort of product reach an impasse. A lot of projects have hit the pause button because they just can’t make the economics of it work now.”
We know that development approvals have increased recently, but developers say that the cost of building, especially high-rise, is prohibitive. Given these cost constraints, how useful is the TLPI for the Kurilpa Sustainable Growth Precinct and proposed similar instruments in addressing affordability in Brisbane?
“Any supply is good supply now in that if we provide more supply through Kurilpa and it’s going to be high-end, it is inevitably going to be expensive. Then, that releases the people that move into that product. They might be coming out of other housing types, opening that up as an opportunity at a more affordable level.”
“So, we’re not providing supply across the price spectrum. At the high-density end of the market, it’s just extremely difficult to do, and it’s even more difficult in suburban precincts, which is a challenge now because the cost to build a medium or high-density apartment in West End or New Farm is more or less the same as to build in Chermside. The people with the capacity to pay are in West End and New Farm, so that makes it really, quite difficult.”
Michael Matusik recently said that a third and a half of new high-rise apartments are sold to overseas interests, and many are empty. Are we just building for the overseas market?
“I don’t know if that’s true of the 2023 market, but it was true a couple of years ago. There’s a lot of risk.”
Mr Elliott said that the viability of projects can rely on pre-sales to international buyers before construction begins. Investors play a crucial role in mitigating risks, as their early commitment to buying off the plan can enable projects that might otherwise stall to move forward.
Brisbane City Council has provided incentives to developers to build more houses. Have they gone too far or not far enough?
“Infrastructure contributions only apply to new projects, obviously. But if you look across the city at the houses in Ascot and Clayfield and wherever else, where the houses have been there for 50 or 100 years, they are in an area which enjoys some of the best amenity and best facilities, lovely streets, no potholes etc. They’re not paying any infrastructure contributions. They’re just paying their rates, and that’s all they have ever paid. Rates and other property taxes are what we use to fund that infrastructure. Putting those charges up front loads the cost on the purchaser of that product and obviously makes it more expensive. So, the Council has tried to reduce that disincentive in the market, recognising the massive increases in construction costs in the last few years. They are trying to stimulate the market, which is utterly appropriate. It’s the right thing to do.”
What can the three levels of government do to encourage more affordable developments in suburban areas, as you argue, as needed?
Mr Elliott said incentives need to go even further, with other levels of government looking at what they can do to reduce the costs and regulatory burden to add new supply into the market.
“Anything that governments can do, not just local government but state and federal government as well, recognising the challenge of bringing that supply to the market is a good thing. Because at the end of the day, it is the private market that provides the most product. We look at how much social housing is provided these days, and they think it’s marvellous if they cut the ribbon on fifteen new apartments somewhere. Well, it’s not a drop in the ocean in terms of what’s needed. So, if we could work out how to deploy private capital with a good social outcome by reducing the risks or overheads, then that’s a good thing to do.”
What about inclusionary zoning?
“Let’s take one hundred apartments; twenty will be sold below market price through an inclusionary zoning mechanism. That means the other eighty apartments will be more expensive to make up for the twenty that are less expensive. So, someone goes in, and they buy one of the inclusionary zoning units, which is less expensive than for everyone else in the same building and when they go to sell, guess what? They will be selling them at a higher price. So, it’s difficult to see how that works other than forming some sort of lottery for those lucky enough to get in on the cheap product.”
Mr Elliott says inclusionary zoning is illusionary.
“I struggle with some of the commentary around housing by people who have no clue about economics and finance. It’s very worrying. Some ideas get a lot of support because their proponents wave them around as a quick fix or magical solution, but they’re not.”
What about exclusionary zoning: many of the suburban areas you talk about have been protected from development?
“There’s a problem with NIMBYs, I’m not saying there isn’t. But it’s all very well and good for so-called urbanists and visionaries and whatever saying, “We should be doing x, y and z.”
“The problem is that the home is still, for the average person, their biggest single asset ever. It’s more than their superannuation. It’s their home, and like in that movie, ‘The Castle,’ it’s their castle. I have a problem with the urbanist few who know what’s best for you.”
Nevertheless, Mr Elliott said there is merit in the missing middle and general density arguments.
“The proponents need to win that argument at the community grassroots level. If people don’t want it, then I’m afraid they’ve got as much of a vote as the next person and if they put up their hand at the ballot box and say no, that’s your answer. “
“But if you want to change their minds, you’ve got to do so. Let’s prove how it can be done better, and that requires more than a promise because there have been too many broken promises, and people are understandably sceptical.
Can planners and developers balance community interests with the need for more affordable housing?
Mr Elliott queried why a community would oppose the development of an unused industrial site when there’s an opportunity for it to be converted into something more pleasing, providing housing and a basis for work. And in the case of the Paint Factory, he says, also a creative industry opportunity.
“I think some of the suburban renewal precincts and the Paint Factory is one example where the result is invariably going to be a heck of a lot better than what’s there now.”
“Some of these [old industrial sites] have more rats than people. They are a legacy of zoning that said ‘this is industrial’, but the industry has gone because the trucks can’t turn around in the narrow streets or they want to be out near places with better distribution networks.
Commentators argue that the shift to the Greens in Queensland and Independents in other states results from growing distrust of party politics and voter frustration with governments that are not listening. To what extent do you think the planning and development industries contribute to this sense of distrust? And what can they do to earn more community trust?
Mr Elliott said the Greens are creating fear and anxiety in the community or false hope.
“Some people decide to find fault with everything because it gets them a cheap headline or two, and it gets them a few followers. I think some of the comments made about the Paint Factory, for example, are not even true. But they are reported and passed on and some people believe that.”
“But having said all that, the whole notion of performance-based planning is a difficult concept. And we have succeeded in making planning so complicated now that every second law firm has a planning practice, and half a dozen lawyers.”
“It shouldn’t be that difficult and should ideally be more transparent. We ought to be using more visual tools to explain what’s proposed for particular sites or precincts. Writing reams and reams of black-letter law doesn’t help anyone understand anything. We have the technology to provide virtual environments to say, “Well, this is what we’re proposing.” And I think it’s much easier for people to engage with that and understand what’s involved.”
Aria faced a legal challenge from the West End Community Association centred around performance-based planning, specifically seeking additional height for a green building. This highlighted the importance of engaging with the community during the planning phase to gather valuable input and minimise objections. Mr Elliot noted that the building industry often needs to catch up in this regard.
“I think it’s something the industry could do better.”
What next for suburban futures?
“We have had a lot of fun with the Chermside Project, and we are looking at other areas across the city.”
“We want to work with Logan Council on what they’re trying to do down there at Underwood. We’re looking at doing something at Wynnum.
“While considering the SEQ regional plan, there needs to be more thought about where jobs will be and what types of jobs will drive the future economy. One of the significant challenges is to prevent the idea of dormitory suburbs where people have to commute great distances to their place of work or school. So, we’re trying to provide a bit of balance and argue that if we invest more in our suburban places, not only is that a fair thing to do, because we spend more taxpayers’ money on people who are already very well off. Let’s start investing in the Chermsides and Mount Gravatts of the world and see what can be done in those places. It’s a long game. It’s not looking for quick sugar fixes.
“There is also a lot of interest in how we can support regional cities: they’re going through challenges like those of some suburban centres.”
Suburban Futures has a book coming out. Can you talk about that?
“We’ve invited experts from across the geographic and political spectrum from Canada, the US, and Australia. The theme of the book is the next Australian city. We’re asking the authors to consider the recent history of suburban development in their state or region, what’s driving it, and what the future will look like.
“We hope that it provides a handy resource because all the books on planning are focused on inner cities. So, let’s have a look at the suburbs where 80 per cent of the people live.”