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GUEST OBSERVATION
Election season means transport season: just as the recent <a href="https://theconversation.com/how-the-nsw-election-promises-on-transport-add-up-112531" target="_blank">New South Wales</a> and <a href="https://theconversation.com/how-much-will-voters-pay-for-an-early-christmas-eight-charts-that-explain-victorias-transport-election-106782" target="_blank">Victorian</a> elections gave us massive new transport promises, so too is the federal government relying on the enduring popularity of new roads and rail. But look beyond the rhetoric and the past three years have been largely business as usual. That leaves plenty of room for the next government, of whatever colour, to take a fresh look at how transport promises are made – and plenty of room to improve.
Last week’s federal budget committed to transport expenditure of <a href="https://www.budget.gov.au/2019-20/content/bp1/download/bp1_final.pdf" target="_blank">A$7.4 billion in 2019-20</a>, and A$33 billion over the four-year forward estimates period.
The government claims it’s spending a <a href="https://www.budget.gov.au/2019-20/content/community.htm#transport" target="_blank">record A$100 billion</a> over a decade. Yet the <a href="https://www.billshorten.com.au/2018_budget_reply_canberra_thursday_10_may_2018" target="_blank">opposition claims</a>: “Across the four years of this budget, Commonwealth investment in infrastructure actually falls, from A$8 billion to A$4.5 billion.” And <a href="https://www.afr.com/business/infrastructure/coalition-needs-to-fill-infrastructure-shortfall-20190329-p518u0" target="_blank">Infrastructure Partnerships Australia says</a> recent budgets are down on the long-term average by about A$11 billion over the forward estimates.
How much is the government actually spending?
With such polarised views, who are we to believe?
In reality, the <a href="https://theconversation.com/budget-transport-spending-is-about-par-for-the-course-but-the-pattern-is-unusual-114597" target="_blank">expenditure for 2019-20</a> is absolutely normal. At 0.37% of GDP, it’s close to the midpoint of spending on transport under treasurers Scott Morrison, Joe Hockey and Wayne Swan. In each of the past ten budgets, annual transport spending in the year following the budget has been <a href="https://theconversation.com/budget-transport-spending-is-about-par-for-the-course-but-the-pattern-is-unusual-114597" target="_blank">0.26-0.53% of GDP</a>.
What is different is the extent of promises that lie beyond the forward estimates period. The move to a <a href="https://buildingourfuture.gov.au/assets/documents/10_Year_Infrastructure_Pipeline.pdf" target="_blank">ten-year pipeline of promises</a> might be fine in theory, but an interested elector can rely only on what’s in the budget papers. And from that they would conclude there’s nothing unusual to see here.
A new enthusiasm for equity investments
All these figures concern grants to state governments, which are responsible for transport networks. But, in addition to these grants, the federal government has developed an enthusiasm for funding projects “off-budget”. In the past two years, the Commonwealth made <a href="https://www.budget.gov.au/2018-19/ministerial-statements/2018-19-regional-ministerial-budget-statement.pdf" target="_blank">equity investments</a> of A$9.3 billion in <a href="https://inlandrail.artc.com.au/" target="_blank">Inland Rail</a> and A$5.3 billion in <a href="https://westernsydneyairport.gov.au/" target="_blank">Western Sydney Airport</a>.
The <a href="https://treasury.gov.au/publication/charter-of-budget-honesty-policy-costing-guidelines__trashed/appendix-a-costing-of-measures-and-updating-estimates__trashed" target="_blank">Charter of Budget Honesty</a> states that an investment can be treated as an off-budget equity injection only if the government has a “reasonable expectation” of recovering the investment. In other words, the entity must be expected to make a positive return over time.
But this gives governments a lot of latitude. A positive rate of return is not the same as a commercial one. And there seems little likelihood of commercial returns in either case.
For Inland Rail, it’s no secret that the Australian Rail Track Corporation will <a href="https://www.afr.com/news/economy/barnaby-joyces-inland-rail-revenues-wont-cover-capital-cost-artc-ceo-says-20180219-h0wbvw" target="_blank">never be asked to repay the A$9.3 billion</a>, even when project revenues start to flow in 2025. Let’s hope the finance minister is right to insist there’s no prospect the project will need even more taxpayer support, despite the risks identified in the <a href="https://www.budget.gov.au/2018-19/bp1/bp1.pdf" target="_blank">budget papers themselves</a> and by the Commonwealth <a href="https://www.anao.gov.au/sites/default/files/ANAO_Report_2017-2018_9.pdf" target="_blank">Auditor-General</a>. With no expectation of repayment, there is no practical difference between this “equity investment” and a grant.
For Western Sydney Airport, the government decided to build the airport itself after Sydney Airport Corporation declined its right to build it. The airport operator said the offer as it stood was “<a href="https://www.afr.com/business/infrastructure/airports/badgerys-creek-deeply-uneconomic-sydney-airport-ceo-kerrie-mather-20170216-gueiq6" target="_blank">deeply uneconomic</a>”. It cited operational, traffic, financial and political risks.
So it’s hard to share the confidence of the then treasurer (and now prime minister), Scott Morrison, when <a href="https://www.afr.com/news/politics/govt-set-to-build-airport-rail-link-with-good-debt-20170427-gvtcmy">he said</a> the new airport will “generate an income stream that’s going to pay for itself”.
In both cases, if a future government ends up writing down the fair value of these assets, this will appear on the balance sheet as a change to “other economic flows”. It won’t be separately identified. Nor will the write-down show up in the underlying cash balance figure that the media spotlight highlights on budget night.
The unavoidable conclusion is that pushing transport spending off-budget seriously diminishes not only the discipline that comes from competing for funds through the budget process, but also transparency in how public money is being spent.
A foray into road pricing is stillborn
In November 2016 the government took an unusually bold step: <a href="https://transportinfrastructurecouncil.gov.au/publications/files/Australian_Government_Response_to_Australian_Infrastructure_Plan_November_2016.pdf" target="_blank">it committed</a> to holding an inquiry into road-user charging. The then minister for urban infrastructure, Paul Fletcher, was in good company. His commitment to commission a review led by an eminent Australian was in response to a <a href="https://infrastructureaustralia.gov.au/policy-publications/publications/files/Australian_Infrastructure_Plan.pdf" target="_blank">2016 recommendation</a> from Infrastructure Australia, which invoked a similar <a href="http://competitionpolicyreview.gov.au/files/2015/03/Competition-policy-review-report_online.pdf" target="_blank">recommendation in the 2015 Harper Review</a> of competition policy, which in turn referred to a <a href="/news">2014 Productivity Commission recommendation</a>. And the backdrop to all these reports was a <a href="http://taxreview.treasury.gov.au/content/downloads/final_report_part_1/00_afts_final_report_consolidated.pdf" target="_blank">recommendation of the 2010 Henry Tax Review</a>.
But time passed and no eminent person was appointed. More time passed, ministers moved portfolio, and no eminent person was appointed. Finally, in October 2018, current minister Michael McCormack <a href="https://www.afr.com/news/politics/deputy-pm-michael-mccormack-shelves-inquiry-into-road-pricing-20181004-h1688d" target="_blank">declined to commit</a> to the inquiry.
An inquiry is no more than an inquiry, but a non-inquiry is a commitment to the status quo. Roads funding and roads investment are serious topics, and many <a href="https://www.pc.gov.au/news-media/speeches/infrastructure-pricing-reform/infrastructure-pricing-reform.pdf" target="_blank">commentators have argued</a> that they are the laggards of regulatory reform.
A change to how road use is funded could significantly alter which roads are funded, what maintenance is done, and how networks are managed. It appears to have been all too much for this government. This task awaits a future government.
The alternative government’s most important promises aren’t the sexy ones about electric vehicles. They are <a href="https://www.alp.org.au/media/1539/2018_alp_national_platform_constitution.pdf" target="_blank">Labor’s promises</a> that Infrastructure Australia should assess projects before the decision to invest, and to release assessed business cases. These promises may sound worthy and a little dull, but in reality they are big and welcome commitments.
Less obvious is how to square them with federal Labor’s promise to advance high-speed rail, or the promise to <a href="https://www.billshorten.com.au/getting_melbourne_s_suburban_rail_loop_on_a_faster_track_sunday_14_october_2018" target="_blank">work with the Victorian premier “to deliver the visionary Melbourne Suburban Rail Loop”</a>. Both of these are massively expensive projects with nothing approaching an assessed and publicly available business case.
It would be a significant improvement if whichever party wins government next month were to commit to, and follow through on, careful assessment of transport gaps and problems, consideration of the various feasible solutions, and rigorous evaluation of the preferred approach. And it’s not enough just to do this; it should be done in public.
Let’s hope.
Marion Terrill, Transport and Cities Program Director, Grattan Institute
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/business-as-usual-record-on-transport-leaves-next-government-plenty-of-room-to-improve-113571" target="_blank">original article</a>.
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j.ballantyne1990-6AQqhLzZaK

Business-as-usual record on transport leaves next government plenty of room to improve

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GUEST OBSERVATION
Regulation of the Australian building industry is broken, according to the <a href="https://www.industry.gov.au/data-and-publications/building-confidence-building-ministers-forum-expert-assessment" target="_blank">Shergold-Weir report</a> to the <a href="https://www.industry.gov.au/regulation-and-standards/building-and-construction/building-ministers-forum" target="_blank">Building Ministers’ Forum</a> (BMF).
"[…] we have concluded that [the] nature and extent [of problems] are significant and concerning. The problems have led to diminishing public confidence that the building and construction industry can deliver compliant, safe buildings which will perform to the expected standards over the long term."
You can say that again.
Just one of the issues identified in the report, combustible cladding, <a href="https://www.theaustralian.com.au/national-affairs/hit-list-identifies-10000-potential-grenfellstyle-buildings/news-story/65aaf99088ead16bd3e0947a6e242770" target="_blank">could affect over 1,000 buildings across Australia</a>. An unknown proportion of these are tall (four storey and above) residential strata buildings. Fears of rectification costs are starting to have <a href="https://www.afr.com/real-estate/melbourne-apartment-buildings-face-extra-scrutiny-over-combustible-cladding-20190205-h1avoi" target="_blank">severe impacts on the apartment market</a>.
The cost of replacing combustible panels at the Lacrosse Apartments in Melbourne, which caught fire in 2014, will be <a href="https://theconversation.com/lacrosse-fire-ruling-sends-shudders-through-building-industry-consultants-and-governments-112777" target="_blank">at least A$5.7 million, plus A$6 million or so in consequential damages</a>. The total cost of replacing combustible panels across Australia is unknown at this point, but is likely to run to billions of dollars.
The <a href="https://www.industry.gov.au/data-and-publications/building-confidence-building-ministers-forum-expert-assessment" target="_blank">Shergold-Weir report</a> identifies a catalogue of other problems, including water leaks, structurally unsound roof construction and poorly constructed fire-resisting elements. Faults appear to be widespread.
A <a href="https://cityfutures.be.unsw.edu.au/documents/44/Governing_the_Compact_City_EXECUTIVE_SUMMARY.pdf" target="_blank">2012 study by UNSW City Futures</a> surveyed 1,020 strata owners across New South Wales and found 72% of respondents (85% in buildings built since 2000) knew of at least one significant defect in their complex. Fixing these problems will cost billions more.
Regulatory failures are not only “diminishing public confidence”, they have a direct impact on the hip pockets of many Australians who own a residential apartment. In short, building defects resulting from lax regulation are a multi-billion dollar disaster.
How could authorities let this happen?
A web of regulations and standards enacted by governments cover construction in Australia, but this regulation is centred on the <a href="https://ncc.abcb.gov.au/ncc-online/About" target="_blank">National Construction Code</a> (NCC). The <a href="https://www.abcb.gov.au/ABCB/The-Board" target="_blank">Australian Building Codes Board</a> (ABCB), a body controlled by the Building Ministers’ Forum, manages the NCC. The ABCB board comprises appointed representatives from the Commonwealth plus all the states and territories and a few industry groups.
It is such a complicated system that it is hard to identify any government, organisation or person that is directly responsible for its performance.
The NCC is supposed to create “benefits to society that outweigh costs” but it appears the ABCB may have been more focused on the need to “consider the competitive effects of regulation” and “not be unnecessarily restrictive” (Introduction to NCC Volume 1).
The BMF’s <a href="https://www.industry.gov.au/sites/default/files/bmf-communique-8-february-2019.pdf" target="_blank">February 8 communique</a>, issued after the <a href="https://www.industry.gov.au/sites/default/files/bmf-communique-8-february-2019.pdf" target="_blank">fire in the Neo200 building</a> in Melbourne, is straight out of the Yes Minister playbook:
"Ministers agreed in principle to a national ban on the unsafe use of combustible ACPs (aluminium composite panels) in new construction, subject to a cost/benefit analysis being undertaken on the proposed ban, including impacts on the supply chain, potential impacts on the building industry, any unintended consequences, and a proposed timeline for implementation. Ministers will further consider this at their next meeting [in May this year]."
This suggests the ministers are more concerned about possible impacts on the panel suppliers and the building industry than the consumer. The earliest a ban can take effect is in May. In the meantime, anecdotal evidence suggests buildings are still being clad in combustible ACP.
Thanks to the journalist Michael Bleby, we know <a href="https://www.afr.com/real-estate/governments-failed-to-act-on-warnings-of-combustible-cladding-dangers-20190226-h1br6n" target="_blank">governments and the ABCB failed to act in 2010</a> when presented with evidence that combustible ACP was not only a danger, but was also being widely used on tall residential buildings.
Bleby quoted ABCB general manager Neil Savery as saying neither his organisation, nor any of the states, was aware that builders were using the product incorrectly.
We also know that panel manufacturers, including the Australian supplier of Alucobond, actively lobbied building ministers. At the July 2011 BMF meeting, the ACT representative effectively vetoed an ABCB proposal to issue an advisory note on the use of combustible ACP.
We are entitled to ask why the ABCB and its staff, or the downstream regulators and their staff, did not know about serious fire problems with ACP that the technical press <a href="http://www.cookeonfire.com/pdfs/eurisolgreenreport.pdf" target="_blank">identified as long ago as 2000</a>. The answer will be of particular interest to residents of tall apartment buildings clad in these panels, all of whom are now living with an active threat to their safety.
Consumers are owed better protection
While both Labor and Coalition governments have worked to improve consumer protection for people buying consumer goods, their record on housing, particularly apartments, is awful. While a consumer can be reasonably sure of getting restitution if they buy a faulty fridge, <a href="https://www.smh.com.au/business/consumer-affairs/victims-suffer-as-combustible-cladding-crisis-rages-on-20190402-p519yy" target="_blank">no such certainty exists if they buy a faulty house or apartment</a>.
At the moment, the NCC does not have any focus on providing protection for buyers of houses or apartments. There are few requirements for the durability of components and astonishingly weak requirements for waterproofing. Under the NCC and its attached Australian Standards, particularly AS 4654.1 and 2-2012, a waterproof membrane could last, in practice, five minutes or 50 years.
Given the magnitude of the economic loss, it would be appropriate for the BMF and ABCB board to publicly admit they have failed. Since their appointments in November 2017 and January 2013 respectively, neither ABCB chair John Fahey nor Savery as general manager has remedied the situation. The Shergold-Weir report has not been implemented and the combustible cladding issues remain unresolved. It would be reasonable for Fahey to step down and for Savery to consider his future.
The next federal government should consider what further action should be taken, particularly in relation to individuals on the BMF and within the ABCB involved in the 2010-2011 decision not to issue the proposed advisory note on the use of ACP. Since the ABCB does not publish minutes and none of its deliberations are in the public domain no one knows what actually happened or who did what.
The new board should consider moving residential apartment buildings (Class 2 buildings in the NCC classification) from Volume 1 of the NCC to Volume 2, which controls detached and semi-detached housing. Volume 2 should then have as its overriding objective the protection of consumers.
The downstream regulators should focus on requiring builders to deliver residential buildings with no serious faults and providing simple mechanisms for redress if they don’t.
Surely this is not too much to ask.<img src="https://counter.theconversation.com/content/113115/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Geoff Hanmer, Adjunct Lecturer in Architecture, UNSW
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/housing-with-buyer-protection-and-no-serious-faults-is-that-too-much-to-ask-of-builders-and-regulators-113115" target="_blank">original article</a>.
This article has been updated to correct a reference to NCC volumes 1 and 2 – the latter controls detached and semi-detached housing.
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Housing with no serious faults and buyer protection – is that too much to ask of builders and regulators?

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NSW’s population, currently sitting at 8,048,000 is tipped to rise to 8.63 million by 2022.
At the same time the Australian population will rise, according to the budget estimates, from 25.1 million to 26.9 million.
But NSW’s lead over Victoria will narrow from being some 1.5 million more residents to around 1.44 million more.
NSW is set to continue receiving high overseas migration settlement, but see a continued decline every year with residents moving interstate.
The interstate exodus from NSW is tipped to see a 16,000 annual decline for the next four years.
Queensland is the biggest beneficiary with 18,400 new arrivals from other states, with Victoria expected to gain 16,800 annually.
WA and SA are also set to lose resident, by 12,000 and 6,500 annually respectively.
The estimates of migration, interstate and overseas, are based on a weighted average of the past three years, the federal budget papers noted.
The total fertility rate is assumed to be 1.781 babies per woman in 2018, and is assumed to rise to 1.900 babies by 2021.
The budget confirmed the Government will reduce the level of overseas migration from 190,000 to 160,000 places for four years from 2019-20.
For the 2019-20 migration program, there will be 108,682 places in the skill stream, 47,732 places in the family stream, with a combined 3,586 places for child and special eligibility streams.
Net overseas migration is tipped to peak this year at 271,700.
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Population gap to narrow between NSW and Victoria

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Josh Frydenberg has accused Labor of “lying” about figures behind their negative gearing reforms. 
It comes as the Australian ­Bureau of Statistics has denied claims it had produced data showing that only 7 per cent of property invest­ors bought new homes, a figure opposition treasury spokesman Chris Bowen has been using repeatedly to back his housing policy.
Mr Bowen’s use of ABS data has been challenged by the Grattan Institute, a ­public policy think tank, which has argued that 14 per cent of ­investors buy new properties rather than existing ones. 
Mr Bowen has repeatedly referred to ABS figures purportedly showing that negative gearing has failed to promote construction in new housing and create jobs. 
But ABS financial statistics analyst Tony Mitchell told The Australian newspaper the ABS did not collate the figures Mr Bowen had been referring to since 2016. 
“If you wanted to have those numbers you wouldn’t be able to get them from our statistics ­because we don’t collect them,” Mr Mitchell told The Australian. 
“We’ve got a little bit about construction, but it is to do with lending to businesses for construction of investment dwellings. It is not to do with lending to households for construction of ­investment dwellings.
“There is nothing about lending­ for newly constructed dwellings. That is included in other statistics, but you can’t break it out.” 
The Treasurer said Bowen had been “caught out” and had to “come clean” about Labor’s sums in his budget reply speech later today.
“Bill Shorten and Chris Bowen have been tripping over their shoe laces and the election hasn’t even begun,” the Treasurer told Sydney’s Alan Jones on 2GB radio this morning.
“The Labor Party in reality may see a big black hole in them because they have underestimated the number of negative gearers who use new homes.
“Chris Bowen needs to come clean about the data.”
“The most recent Australian Bureau of Statistics data shows that 93 per cent of new investment loans go to people purchasing ­existing housing stock,” Mr Bowen said in January. 
“This means that the vast bulk of investment does not increase supply or boost jobs. 
“All it does is increase demand and the price of the existing homes, allowing investors to use tax subsidies to outbid owner-occupiers and first-home buyers.”
Grattan Institute director Danielle Wood said the independent think tank had estimated that more investors bought new properties than Labor was claiming. 
“It is right that you can’t ­directly calculate it from the ABS data because some of the finance is going into homes that are newly constructed and you can’t see the split between­ investors and owner-occupiers for that ­category,” Ms Wood said. 
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The Property Investors Council of Australia (PICA) said the use of ‘dodgy data’ shows Labor must urgently authorise the Parliamentary Budget Office to release modelling and assumptions used in their negative gearing and capital gains tax policies.
“If Labor has nothing to hide, then this is a straight forward exercise in full disclosure so all property owners can understand their reasoning for such significant reform,” said PICA chairman, Ben Kingsley.
Mr Kingsley said Labor’s keystone policy failed to include off-the-plan and house-and- land packages in its estimation that more than 90 per cent of new investment loans are to people purchasing existing housing stock.
He said industry experts have shown this figure to be woefully inaccurate.
“Just today Australia biggest aggregator – AFG with over 2900 mortgage brokers – confirmed its mortgage application data for new investment purchases vs. existing property was 43% new and 57% existing,” he said.
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Labor's Chris Bowen accused on major negative gearing data miscalculation

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Wynn Resorts says it has scrapped preliminary talks to acquire the James Packer-controlled Crown Resorts for $10 billion ($US7 billion) after the Australian Financial Review broke news of the negotiations.
Crown shares jumped as much as 22 per cent <a href="/news/las-vegass-wynn-resorts-seeking-crown-resorts">on the news yesterday</a> to $14.37, close to the $14.75 per share level that Crown said Wynn’s latest cash-and-stock offer valued the company.
When the markets opened they shot down 10.6% to $12.55.
After the AFR revealed Wynn’s takeover approach, Crown not only confirmed the confidential talks on Tuesday, but also disclosed the price that Wynn was offering.
It added that Crown’s board had not yet considered Wynn’s latest offer.
Wynn, the world’s No.2 casino operator, then issued two statements, first confirming the talks, and, a few hours later, stating that they had ended.
“Following the premature disclosure of preliminary discussions, Wynn Resorts has terminated all discussions with Crown Resorts concerning any transaction,” the company said in its second statement.
Wynn was founded in 2002 by Steve Wynn, who started his casino business in Las Vegas in the 1960s.
Beset by sexual misconduct allegations, Wynn left the company and sold his entire 11.8 per cent stake in Wynn Resorts for $US2.1 billion last month.
Wynn operates large resort-and-casino complexes in Las Vegas and Chinese gambling hub Macau, with another under construction in Massachusetts.
The Australian reported the departure of Wynn Resorts billionaire founder Steve Wynn last year enabled the US-based casino operator to come forward with its $10 billion takeover approach for Crown Resorts.
It wrote the offer landed with the company about one month ago, after which Crown called in Goldman Sachs and UBS as its defence advisers.
Ashurst is working as a legal adviser to Crown, which counts James Packer as a 47 per cent shareholder.
Then there was the period when both tycoons were competing for the casino licence in Sydney decades ago, <a href="/news/when-donald-trump-toyed-with-opening-darling-harbour-sydney-casino">and even Donald Trump</a>.
Wynn was unsuccessful in securing the Sydney casino, which was won by Harrah.
Moelis is understood to be working on the transaction with Wynn because of the connections of founder Ken Moelis with casino operators in the US. 
Deutsche Bank is also involved.
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Crown shares drop 10% after AFR leak on Wynn/Packer talks scuttle negotiations 

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GUEST OBSERVATION
Chinese investment in Australia fell 36% in 2018, to A$8.2 billion (US$6.2 billion) from A$13 billion (US$10 billion) in 2017, according to research by KPMG and the University of Sydney Business School.
This is despite Chinese investors still generally regarding Australia as safer and more attractive than most other countries. So 2018 need not be a turning point. But it is cause for reflection.
Discussion about Chinese investment in recent years has been dominated by political and security concerns. These concerns need to be balanced by the national interest in economic prosperity. Chinese investment creates jobs, increases export opportunities and deepens relations with our most significant trade partner.
Arguably the pendulum has to swing back to thinking about the economic benefits. We need a more balanced national conversation.
Many losers, one winner
Our data covers direct investments through mergers and acquisitions, joint ventures and new projects. We do not include portfolio investments, such as buying stocks and bonds, which do not result in foreign management, ownership or legal control. Nor do we include residential property sales.
In the mining, agribusiness and services sectors investment fell by more than 90%. In renewable energy it fell by 48%, and in commercial real estate by 31%.
The only sector where investment did not fall was health care, where investment more than doubled to A$3.4 billion. This made health care the biggest investment sector, attracting 41.7% of all Chinese money, relegating commercial real estate (36.7%) to second place.
The declines were driven by state-owned enterprises pulling back on foreign investment. In 2018 13% of Chinese money came from state-owned enterprises, with 87% from private companies.
This reflects the Chinese government’s greater control of capital outflows and pressure to reduce debt levels, as well as the Australian government’s security concerns about Chinese influence.
It also reflects global dynamics. Chinese investment in Australia is no longer isolated from scrutiny of Chinese investment in North America and Europe. Excluding Chinese technology from telecommunications infrastructure is a notable example.
In the United States, Chinese investment fell 83% to US$4.8 billion from US$29 billion in 2017. In Canada, it fell 47% to US$3.4 billion from US$6.2 billion in 2017.
Balancing competing concerns
Australian governments, corporations and professional advisers need to consider what types of Chinese investments and investors are desired and actively welcome in Australia.
Our report points to areas where Chinese investment is in Australia’s national interest and benefits the global integration and competitiveness of Australian industries.
Health care is a key example.
Chinese investment in health care companies has both provided capital for innovation and facilitated entry into the Chinese market.
Take the Chinese private equity firm <a href="https://www.smh.com.au/business/markets/sirtex-medical-goodbyes-varian-backs-1-9b-chinese-offer-from-cdh-20180614-p4zlk1" target="_blank">CDH buying Sirtex Medical Ltd</a> for A$1.9 billion. Sirtex is an Australian medical device company with a treatment for liver cancer. Its acquisition enables expansion into China, which accounts for more half of the global incidence of liver cancer.
In mining, lithium provides an example of Chinese investment adding value. <a href="https://www.tianqilithium.com.au/site/About-Us/company-overview" target="_blank">Tianqi Lithium</a> has invested A$700 million in a <a href="https://www.tianqilithium.com.au/site/About-Us/tianqi-lithium-global" target="_blank">processing plant</a> in Perth. The plant will provide about 200 jobs and produce 48,000 tonnes of battery-grade lithium hydroxide for export.
Even in food and agriculture, which has generated much controversy over land acquisitions, we see room for advantageous investment processing and value-adding facilities, such as regional abattoirs.
Signalling Australia’s economic interests in Chinese and foreign investment is crucial to Australia’s prosperity.
At a time of global uncertainty, Australian politicians, bureaucrats, business leaders, educational organisations and others must work quietly and respectfully with their Chinese counterparts to allay community concerns and consolidate Australia’s reputation as a welcoming and proactive partner.
Hans Hendrischke, Professor of Chinese Business and Management, University of Sydney
The authors contributed to the Demystifying Chinese Investment in Australia Report.<img src="https://counter.theconversation.com/content/114984/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/chinese-investment-in-australia-is-down-36-its-time-for-a-more-balanced-debate-about-the-national-interest-114984" target="_blank">original article</a>.
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Chinese investment in down 36% - it’s time for a more balanced debate about the national interest

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GUEST OBSERVATION
Half a billion dollars sounds like a lot of money, but that really depends on what you’re spending it on. In Tuesday’s federal budget, the Coalition government announced its <a href="https://theconversation.com/tax-giveaways-in-frydenbergs-back-in-the-black-budget-114177" target="_blank">Commuter Car Park Fund</a>, a A$500 million, 10-year package intended to make it easier for people in the suburbs and regions to drive to their local railway station.
While this is a drop in the ocean compared with the wider transport infrastructure budget, we’re going to use it here as a starting point to run some thought experiments to see if this is the best way to spend our taxes to help people get around.
How much car parking could we buy for $500 million?
The construction cost for a single parking spot can range from <a href="https://www.ptua.org.au/myths/parkride/" target="_blank">A$10,000 for a surface car park to A$68,000 per space in multi-level structures</a>. So, if all the money is spent on surface car parks, the new fund could build 50,000 spaces at railway stations around Australia.
Of course, not all of these spots are going to be in surface parking lots – some will need to be in multi-level parking garages. So, if we built one multi-level space for every five at ground level, the A$500 million earmarked in the budget would buy us 30,000 parking spaces.
Does increased parking increase transit usage?
If these 30,000 park-and-ride spaces at train stations are built, this is unlikely to lead to an increase in transit patronage. It could even <a href="https://humantransit.org/2014/10/basics-the-math-of-park-and-ride" target="_blank">run counter to providing good public transport</a>.
On the day of the 2016 Census, <a href="https://www.propertyobserver.com.au/https://quickstats.censusdata.abs.gov.au/census_services/getproduct/census/2016/quickstat/036" target="_blank">1,225,668 people used public transport to get to work</a>. <a href="https://www.propertyobserver.com.au/https://quickstats.censusdata.abs.gov.au/census_services/getproduct/census/2016/quickstat/036" target="_blank">Generously assuming</a> that <a href="https://chartingtransport.com/tag/car-occupancy/" target="_blank">a single car has an average of 1.5 passengers</a>, the Commuter Car Park Fund might enable only 45,000 extra people to access the public transport network. That’s a tiny 4% of the current number of people who travel to work by public transport.
But <a href="https://www.citylab.com/transportation/2013/03/how-park-and-ride-encourages-car-use/5034/" target="_blank">studies</a> show that only a small proportion of park-and-riders had previously commuted by car all the way to their destination. Many are existing passengers who used to walk, cycle, bus or drive to a different station but are now opting to drive to the station with new parking places. Non-commuters working or shopping in nearby activity centres also often use park-and-ride spaces.
There are at least 705 train stations in metropolitan Australia, and it is not clear from the budget papers where these extra parking spaces are going to be placed. Sydney has <a href="https://www.transport.nsw.gov.au/sites/default/files/media/documents/2017/Train%20Statistics%202014.pdf" target="_blank">176 train stations</a>, Melbourne has 218, Southeast Queensland has 152, Adelaide has 89, and Perth has 70. Even assuming only 300 stations will need extra parking, that provides an average of only 100 new spaces per station.
More bang for your buck
There are cheaper ways to move an extra 45,000 people a day to and from railway stations and around our cities.
Linking a major university campus with a Skytrain station, Vancouver’s 99 B-Line bus service moves <a href="https://public.tableau.com/profile/translink#!/vizhome/2017TSPR-BusSummary/TheWorkbook" target="_blank">56,000 passengers a day</a> at a cost of less than C$14 million (A$14.7 million) a year.
Similarly, in Toronto, the Finch West bus service carries <a href="https://www.ttc.ca/Customer_Service/Corporate_Plan/Appendices/Key_facts_and_figures/index.jsp" target="_blank">44,000 passengers a day</a> to and from the subway. The Toronto urban transit network moves <a href="https://www.toronto.ca/wp-content/uploads/2017/12/8bd3-TTC-2018-Op-Budget-Notes-V1.pdf" target="_blank">more than a million people a day with an annual operating subsidy of C$713 million</a>.
<img src="https://images.theconversation.com/files/267740/original/file-20190405-123431-1f0fvg4.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
Passengers transferring from the Metro to a feeder bus in suburban Montreal. Iain Lawrie/University of Melbourne, Author provided
Each of these cities has comparable urban landscapes to suburban Australia, but is able to offer buses to nearby stations every five minutes.
We understand that these costs are not necessarily directly comparable. We provide them though as a point to think about, and so you might begin to ask how our cities could be better configured.
Better land use around train stations?
Alternatives like direct and frequent buses <a href="https://theconversation.com/freeing-up-the-huge-areas-set-aside-for-parking-can-transform-our-cities-85331" target="_blank">could liberate space around our suburban train stations</a>. Around the world, stations are community hubs, and even simple stations can be wonderful, vibrant places for people. The best ones are a pleasure to move through and spend time in, unencumbered by the conflict and noise of space dominated by car traffic.
Building car parks wastes that place potential. Instead, it bakes in the mobility habits and planning prejudices that condemn our public places to being grey deserts, difficult to move through, and keeping out parks, shops, gardens, street life, walkability and human interaction.
<img src="https://images.theconversation.com/files/267750/original/file-20190405-114908-1qfn7cz.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
Unsealed car parking at Tarneit station in Melbourne’s western suburbs. Paul Fleckney/University of Melbourne, Author provided
Underpinning the futility of the Commuter Car Park Fund is the fact that “demand” for free parking is fundamentally insatiable. Just like urban road space, building more of the wrong infrastructure simply <a href="https://journals.sagepub.com/doi/pdf/10.3141/2543-19" target="_blank">induces more use and perpetuates congestion</a>.
Parking policy scholars and practitioners have known for decades now that parking demand can be successfully managed, <a href="https://www.foreground.com.au/planning/car-parking-choking-cities/" target="_blank">including via pricing existing parking supply and improving transport alternatives</a>. Pricing and related policies serve as an effective disincentive to people who don’t need to be driving (and parking), freeing up road space for those who do.
Urban congestion is a problem of the quality and connectivity of our public transport network, not just a parking and road space issue. We have long known the policies and mechanisms to shift higher proportions of people to alternatives (and improve conditions for those who need to drive). We still need the funding and the planning capacity to achieve it.
Australia deserves better transport policy and a clearer, better-informed discussion about how its transport funds are being spent.
Nathan Pittman, PhD Candidate in Transportation Planning, University of Melbourne
Crystal Legacy, Senior Lecturer in Urban Planning, University of Melbourne
John Stone, Senior Lecturer in Transport Planning, University of Melbourne
Rebecca Clements, PhD Candidate, Faculty of Architecture, Building and Planning, University of Melbourne
This article is republished from <a href="http://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/500m-for-station-car-parks-other-transport-solutions-could-do-much-more-for-the-money-114908">original article</a>.
Main photo: With more than a million Australians using public transport to get to work each day, demand for car parking at the station is virtually insatiable. <a href="https://www.flickr.com/photos/philipmallis/46402974731/in/photolist-23RbPF2-Gjsh88-2ekmTqK-bEfVA-EDLrAJ-TgfpQc-M5wkF7-HQRQVf-2aX7ext-23zY5e1-PZ8Qfk-RCDnAd-24Lw2wt-RqYRZD-2dUEmhR-Ng589h-2bQ5kHc-RVZuuK-PWm1gP-SA6aE7-2eWmyh4-P6mmSo-D5GjN-dgxvHq-aF3Lb6-bpCRM-KH53p-259W8Ku-aF7wpU-aF7Ah5-4a9Rot-dpDGsV-cwBpZw-9hKnjZ-5sb8ah-91JveF-GLEnUQ-v74pZ4-uadf16-HaSga7-r8ztRk-6Yj2WA-28mpmu2-HTJjNL-23nR3sx-2dGtnJt-BSC48H-RyFCw3-TdcKuw-23NSTS4">Philip Mallis/flickr</a>, <a href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a>
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$500 million for station car parks? Other transport solutions could do much more for the money

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There’s relief coming for workers who have been driven mad by the bumper to bumper.
The budget seeks to encourage the workforce to instead park and ride on the train.
The first funds will be spent at Hurstville, Panania, Gosford and Woy Woy.
The $500 million national program has been dubbed the Commuter Car Park Fund.
It is aimed at providing carparking for the workers wishing to commute to work rather than drive into the increasingly congested CBD.
The bulk will be spent at Gosford which will get a $30 million car park. Panania and Hurtsville gets a $7.5 million allocation with $5 in Woy Woy.
“The Commuter Car Park Fund will allow more people to park and ride, taking tens of thousands of cars off our major roads per day,” the budget papers noted.
“This fund will focus on immediate, practical measures to cut travel times within our cities.
"Removing bottlenecks and improving travel corridors,” the Treasurer said.
It will include a $500 million Commuter Car Park Fund that will improve access to public transport hubs and take tens of thousands of cars off our roads.
NSW is budgeted to get a $50 million car park building allocation which comes under the $4 billion Urban Congestion Fund, which has been boosted by $3 billion.
It comes as Sydney residents have been increasingly frustrated by the unavailability of carparking at railway stations, and also annoyed at the increased road congestion.
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Car park construction spree for select railway stations 

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GUEST OBSERVATION
After a three-year cycle of industry comment, review and revision, May 1 marks the adoption of a new <a href="https://ncc.abcb.gov.au/ncc-online/About" target="_blank">National Construction Code</a> (NCC). Overseen by the <a href="https://www.abcb.gov.au/ABCB/The-Board" target="_blank">Australian Building Codes Board</a> (ABCB), the code is the nation’s defining operational document of building regulatory provisions, standards and performance levels. Its <a href="https://ncc.abcb.gov.au/ncc-online/About" target="_blank">mission statement</a> is to provide the minimum necessary requirements for safety and health, amenity, accessibility and sustainability in the design, construction, performance and liveability of new buildings.
Some say the building industry is in <a href="https://www.thefifthestate.com.au/columns/spinifex/construction-crisis-no-minister-its-broken-try-an-iron-clad-mandated-warranty-instead/" target="_blank">deep crisis and broken</a>, that even our entire building regulatory system is not fit for purpose. Consider what has happened, <a href="https://www.afr.com/real-estate/what-are-australias-other-defective-towers-aside-from-sydneys-opal-tower-20190102-h19n02" target="_blank">particularly in residential construction</a>. We have had buildings <a href="https://theconversation.com/cladding-fire-risks-have-been-known-for-years-lives-depend-on-acting-now-with-no-more-delays-111186" target="_blank">burning</a>, <a href="https://www.smh.com.au/national/nsw/biggest-shake-up-in-building-laws-in-our-state-s-history-follows-opal-tower-debacle-20190210-p50wtd" target="_blank">cracking</a>, windows exploding, <a href="/news/vue-on-king-william-adelaide-cbd-apartment-owners-hot-under-the-collar">rooms with intolerable heat stress</a>, <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2019-02-23/opal-tower-residents-face-long-wait-for-repair-work/10842504" target="_blank">rendered unfit for occupation</a> without <a href="https://www.theguardian.com/australia-news/2019/feb/12/it-could-take-two-years-to-replace-flammable-cladding-in-melbourne-says-building-authority" target="_blank">costly remedial action</a>, class <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2018-09-08/residents-furious-builder-sued-combustible-cladding/10214570" target="_blank">actions against developers</a>, and <a href="https://theconversation.com/lacrosse-fire-ruling-sends-shudders-through-building-industry-consultants-and-governments-112777" target="_blank">multi-million-dollar court judgments</a> against consultants and builders.
Well, how do you measure performance? We should think in terms of lives saved, <a href="https://theconversation.com/health-check-how-can-extreme-heat-lead-to-death-91480" target="_blank">heat stroke</a> minimised, costly remedial works avoided, <a href="https://theconversation.com/too-hot-to-sleep-heres-why-11492" target="_blank">less sleep deprivation</a> and climate-induced respiratory issues, <a href="https://theconversation.com/we-cant-just-leave-it-to-the-ndis-to-create-cities-that-work-to-include-people-with-disability-93419" target="_blank">disability access</a>, <a href="https://theconversation.com/sustainable-housings-expensive-right-not-when-you-look-at-the-whole-equation-60056" target="_blank">less bill shock for the vulnerable</a>, and housing that is built to allow <a href="https://theconversation.com/for-australians-to-have-the-choice-of-growing-old-at-home-here-is-what-needs-to-change-91488" target="_blank">ageing in place</a>.
Safety and amenity
Widespread use of non-compliant building materials, and specifically combustible cladding, has been foremost in the minds of regulators. Three years ago, after the <a href="https://www.melbourne.vic.gov.au/sitecollectiondocuments/mbs-report-lacrosse-fire.pdf" target="_blank">Lacrosse fire in Melbourne Docklands</a>, the ABCB amended the existing code. This crucial revision has been <a href="https://www.abcb.gov.au/Resources/Publications/Education-Training/Fire-performance-of-external-walls-and-cladding" target="_blank">carried forward into the new code</a>.
Individually, states have acted on the findings of a <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/Non-conforming45th/Report" target="_blank">Senate inquiry</a> into this area. Last October, for example, Queensland enacted the <a href="http://www.hpw.qld.gov.au/construction/BuildingPlumbing/Building/Pages/NonConformingBuildingProducts.aspx" target="_blank">Building and other Legislation (Cladding) Amendment Regulation 2018</a>.
Investigations into the highly publicised, structurally unsound Opal tower in Sydney found the design – namely the connections between the beams and the columns on level 10 and level 4, the two floors with significant damage — indicated “<a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2019-01-16/opal-tower-investigation-what-the-report-actually-says/10717830" target="_blank">factors of safety lower than required by standards</a>”.
<iframe src="https://www.youtube.com/embed/jj9MWsDrqg8?wmode=transparent&amp;start=0" frameborder="0" width="440" height="260"></iframe>
Opal Tower report finds “construction issues”.
Just two months ago when the new code was released in preview form, we learnt that a significant number of approved CodeMarks used to certify compliance for a range of building materials are under recall. The Australian Institute of Building Surveyors <a href="https://aibs.com.au/Public/News/2019/20190220_CodeMark_Certificates_Withdrawn.aspx" target="_blank">posted urgent advice</a>: “We are in the process of making enquiries with the ABCB and Building Ministers to find out when they were made aware that these certificates were withdrawn and what the implications for members will be […] and owners of properties that have been constructed using these products.”
Fire safety concerns are driving changes in the code. The new NCC has extended the provision of fire sprinklers to lower-rise residential buildings, generally 4-8 storeys. However, non-sprinkler protection is still permitted where other fire safety measures meet the deemed minimum acceptable standard.
Comfort and health
The code includes new heating and cooling load limits. However, requirements for overall residential energy efficiency have not been increased. The 6-star minimum introduced in the 2010 NCC remains.
The code has just begun to respond to the problem of dwellings that are being constructed to comply but which <a href="https://www.propertyobserver.com.au/https://www.ncbi.nlm.nih.gov/pubmed/27432732" target="_blank">perform very poorly in the peaks of summer</a> and winter and <a href="http://www.thrive-research.com.au/wp-content/uploads/2017/02/Living-Well-Report-Final-for-issue-080317.pdf" target="_blank">against international minimum standards</a>. The change in the code deals with only the very worst houses – no more than 5% of designs with the highest heating loads and 5% with the highest cooling loads.
It’s a concern that the climate files used to assess housing thermal performance use 40-year-old BOM data. Off the back of record hot and dry summers, readers in such places as Adelaide and Perth might be surprised to learn the ABCB designates their climate as “<a href="https://www.abcb.gov.au/Resources/Publications/Education-Training/Energy-Efficiency-NCC-Volume-Two" target="_blank">the mildest region</a>”.
For well over a decade my colleagues and I have researched thermal performance, comfort and health and improvements by regulation. Our <a href="http://anzasca.net/paper/investigating-equivalence-in-compliance-pathways-to-australian-housing-energy-efficiency/" target="_blank">recent paper</a>, based on a small <a href="http://www.nathers.gov.au/newsletters/issue-2-june-2016/nathers-news" target="_blank">sample of South Australian houses built between 2013 and 2016</a>, demonstrated what has been discussed anecdotally in hushed voices across the industry, that a building can <a href="http://anzasca.net/paper/investigating-equivalence-in-compliance-pathways-to-australian-housing-energy-efficiency/" target="_blank">fail minimum standards using one particular compliance option yet pass as compliant using a different pathway</a>.
A building that is not six stars can be built under the new code. In fact, it may have no stars!
Lamentably, there has been no national evidenced-based evaluation (let alone international comparison) of the measured effectiveness of the 6-star standard. CSIRO did carry out a <a href="https://publications.csiro.au/rpr/pub?pid=csiro:EP1312595" target="_blank">limited evaluation</a> of the older 5-star standard (dating back to 2005). An <a href="https://www.abcb.gov.au/Resources/Publications/Consultation/Energy-Action-Modelling-and-Sensitivity-Analysis" target="_blank">evaluation for commercial buildings</a> is available from the ABCB website.
Accessibility and liveability
Volume 2 of the NCC covers housing and here it is business as usual, although the ABCB has released an <a href="https://www.abcb.gov.au/Resources/Publications/Consultation/Accessible-Housing-Options-Paper" target="_blank">options paper</a> on proposals that might be part of future codes. Accessible housing <a href="https://www.abcb.gov.au/Initiatives/All/Accessible-Housing" target="_blank">is treated as a discrete project</a>. Advocates for code changes in this area, such as the <a href="https://anuhd.org/" target="_blank">Australian Network for Universal Housing Design</a> (ANUHD), have written to the ABCB expressing disappointment.
A Regulation Impact Assessment on the costs and benefits of applying a minimum accessibility standard to all new housing has yet to see the light of day.
These proposals or “options” talk of silver and gold levels of design (there is no third-prize bronze option for liveable housing). Codes of good practice in accessible design have for decades recommended such measures.
It’s all about performance
Some argue that deep-seated problems have developed from a code that favours innovation and cost reduction over consumer protection. There is a cloud over the industry and over some provisions – or should we say safeguards and compliance?
Safety should not be a matter of good luck or depend on an accidental selection of a particular building material or system. New buildings born of this new code are hardly likely to differ measurably from their troublesome older siblings. The anxiety for insurers, regulators and building owners continues.
The National Construction Code adopts a performance-based approach to building regulation, but don’t expect the sales consultant to know the <a href="http://www.yourhome.gov.au/passive-design/glazing" target="_blank">U-value</a> of the windows, whether the doors are hung to allow for disabled access, or if the cleat on your tie beam is to Australian standards.
Anyone can propose changes to the NCC. The form is on the website. Consultants will be hired to model costs and benefits.
Regulatory reforms introduced through the ABCB over the past 20 years have produced an <a href="http://www.thecie.com.au/?page_id=379" target="_blank">estimated annual national economic benefit of A$1.1 billion</a>. That’s a lot of money! The owners of failing residential buildings could do with some of that cash to cover losses and legal fees.<img src="https://counter.theconversation.com/content/113729/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Timothy O'Leary, Lecturer in Construction and Property, University of Melbourne
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/australia-has-a-new-national-construction-code-but-its-still-not-good-enough-113729" target="_blank">original article</a>.
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Australia new National Construction Code still isn't good enough

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The South Yarra office market is set to double in size in the next four years in the most significant expansion this increasingly sought after commercial precinct has seen in recent history. 
According to Colliers International research, there is 80,000 square metres of upcoming space in the South Yarra commercial market over three projects, with a pipeline until 2023. 
The largest injection of new office space will be an additional 50,000 square metres over four buildings at the new-look Jam Factory, being developed by Newmark Capital.
An estimated 4,000 square metres will be added at Chapel Plaza (402 Chapel Street) and another 25,000 square metres at Goldfields Group’s 627 Chapel Street which will comprise 25,000 square metres of office space.  
“No substantial office building over 4,000 square metres had been delivered in South Yarra in the last six years – all development in the last five years has been in the Forrest Hill precinct, so as new office space comes online, it joins a thriving, mostly residential, development market in this area,” Rob Joyes, Colliers International National Director of Office Leasing, said. 
“In recent years, large occupiers of 4,000 square metres-plus have had to focus on other city fringe areas such as Richmond and Cremorne due to a lack of options in South Yarra.  
“Led by the rejuvenation of the Jam Factory, these new projects will open the door for large occupiers to position themselves in this tightly held precinct.” 
According to Colliers International, South Yarra’s net lettable area was 97,000 square metres at March 2019. 
“An 80,000 square metres investment in new office space will result in the doubling of this boutique commercial precinct and turn it into one of the next city fringe office hot spots,” Colliers International Research Manager Sarah Walker said. 
“An analysis of historic office demand in the CBD shows that for every new head of population, 0.9 square metres of office space is demanded. Up until about 2015, office supply in the Melbourne CBD broadly kept pace with population growth.
“Since that time, however, the increase in population has outpaced CBD supply growth. This has contributed to the exceptionally low vacancy we are recording in both the CBD and City Fringe markets. 
“Based on ABS forecasts, as well as Colliers’ own analysis of future office supply, this supply/demand imbalance is forecast to become even greater and the undersupply in the CBD will need to be met by alternative markets. 
“Tenant location preferences are continually moving towards greater emphasis on accessibility to public transport and amenity for staff. City fringe markets, particularly those serviced by a train station, are best positioned to capture this demand.  
“Vacancy in the city fringe is currently at just under 4.5%, and has been sub-4.5% for two years now. Coupled with the very low vacancy in the CBD, and a forecast for continued low vacancy, upcoming supply in the City Fringe is expected to be met favourably by Melbourne occupiers.” 
Joyes said office leasing teams were seeing a strong desire from businesses to cater to the lifestyle of their staff.
“People want to work, live and play in close proximity, and South Yarra offers not only easy access to the CBD for meetings but an abundance of after hours entertainment and amenity for employees to enjoy,” he said.
“The Jam Factory in particular is set to capture this demand and be snapped up by savvy businesses looking to attract and retain the best staff. This once in a generation development will truly unlock the full potential of this commanding 1.8 hectare site in one of Melbourne’s fastest growing and most affluent suburbs.  
“Occupiers of the Jam Factory will also be able to take advantage of a new dedicated pedestrian connection linking the development to South Yarra railway station, one of the busiest train stations outside the Melbourne CBD.” 
Jonathan Bradhurst , Newmark Capital Project Director, said The Jam Factory was at the focal point of South Yarra’s vibrant lifestyle precinct fueled by innovation, creative industry and its young and affluent demographic.  
“South Yarra continues to evolve, on trend, with an exciting lineup of new apartments, food halls, restaurants and gyms in the pipeline,” Bradhurst said.
“Businesses across the spectrum of culinary, physical fitness and wellness and entertainment see the value of bringing their services to South Yarra to reach the millennial, educated demographic that makes up nearly 50% of the neighbourhood’s residents.
Jonathan Isaacs, of the Clemenger Group, said South Yarra was an ideal fit for businesses looking to provide work-life balance in close proximity to the CBD and an abundance of amenity. 
“We’re proud to base some of the Clemenger Group’s businesses in South Yarra because our employees love to work here,” he said.
“Our agencies get to form a part of the creative precinct along Chapel Street, and the competitive overheads mean we can invest in contemporary, exciting office fit-outs that reflect the businesses they house.”
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South Yarra office market set to double with record injection of capital

For most new apartment buildings, the Owners Corporation starts life with little more than a bank account and the first quarterly strata levies.

At <a href="https://www.apartments.com.au/buildings/9-gay-street-castle-hill-9-gay-street-castle-hill-nsw-2154">9 Gay Street</a> in <a href="https://www.apartments.com.au/developments/castle-hill-nsw-2154">Castle Hill</a>, it starts with around $7 million in reserve.

It's an unusual legacy of what was once one of Sydney's highest-profile apartment remediation projects. When the development, originally known as Skyview and built by disgraced developer Top Place, came under scrutiny by then NSW Building Commissioner David Chandler, an $11 million remediation bond was negotiated to ensure any building defects could be fully rectified.

The building underwent an 18-month remediation program, during which around $4 million of that bond was spent bringing the building up to the standard it should have been in from the outset.

After extensive inspections, all active rectification orders have been lifted. What's more, around $7.2 million remains secured for the Owners Corporation for the next 15 years.

In a twist few would have predicted, what began as a significant concern for purchasers has left the building with something almost unheard of in the apartment market: a multi-million-dollar financial reserve from day one.

[smartcode_project:default project_id=147685 project_image_fid=359136]

<a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a> Executive Chairman Greg Huxley said the structure offers buyers a level of certainty that is difficult to replicate.

"The $11 million bond established for the Skyview Castle Hill development represents exceptional value, providing genuine financial security for purchasers," Huxley said.

"Unlike a standard insurance policy, this bond consists of real funds held in trust for the Owners Corporation, offering a tangible layer of protection and added peace of mind."

The apartments themselves have been designed with a focus on practical, contemporary living. Interiors feature Smeg appliances, stone benchtops, tiled living areas, carpeted bedrooms, 2.7-metre ceilings, floor-to-ceiling glazing, and ducted heating and cooling throughout.

Residents also have access to a range of shared amenities, including two rooftop barbecue areas, a swimming pool, children's playgrounds, secure building access, storage cages, and visitor parking.

The location continues to be one of the project's strongest drawcards. Castle Hill Metro Station sits virtually on the doorstep, providing direct connections across Sydney's expanding Metro network, while Castle Towers offers extensive retail, dining, entertainment, and service amenities within walking distance.

[smartcode_project:default project_id=147685 project_image_fid=359127]

The building, now named after its location at 9 Gay Street, comprises a diverse mix of one-, two-, and three-bedroom apartments starting from just under $600,000.

Equitifund National Sales Director Ben Hamblett said demand in the Hills District continues to be driven by buyers seeking convenience and connectivity.

"Interest from both owner-occupiers and investors in Castle Hill remains exceptionally strong, with buyers consistently prioritising developments in close proximity to the Metro station and Castle Towers Shopping Centre," Hamblett said.

"There is a clear trend in the market, with purchasers seeking convenient access to transport and lifestyle amenities that support a seamless, low-maintenance way of living."

On top of the long-term protection afforded by the remaining $7.2 million bond, Equitifund is offering a limited-time stamp duty rebate on selected apartments.

Eligible purchasers can also secure finance options, including a 3.99 per cent two-year variable rate, loan-to-value ratios of up to 90 per cent, and interest-only lending options through EquitiCredit.

[smartcode_project_cta:default project_id=147685]

Joel Robinson

Why this Castle Hill apartment building starts with a $7 million advantage

For much of the past few years, conversations about Australia's property market have centred on the rapid growth seen in Sydney, Brisbane, Gold Coast, and Perth. <a href="https://www.apartments.com.au/developments/melbourne-vic-3004">Melbourne</a> has followed a different trajectory.

That relative underperformance is now encouraging some buyers to reassess the city, particularly those willing to look beyond short-term market movements and focus on quality property in established locations, along with the long-term growth prospects of a city expected to overtake Sydney as Australia’s most populous.

John Bekiaris, Research &amp; Market Insights at <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Projects by Equitifund</a>, said Melbourne's current position is attracting increasingly sophisticated purchasers.

"Melbourne continues to present one of Australia's strongest long-term investment stories," Bekiaris says.

"While other capital cities have experienced stronger recent growth, that relative underperformance is exactly what's attracting sophisticated counter-cyclical investors."

[smartcode_project:default project_id=1979 project_image_fid=363268]

Equitifund isn't just commenting on Melbourne's property market, it's investing in it.

The Sydney-headquartered capital partner has taken over the remaining apartments at <a href="https://www.apartments.com.au/buildings/victoriana-melbourne-20-queens-road-melbourne-vic-3004">Victoriana</a>, the recently completed glass-encased development opposite Albert Park Lake in Melbourne's tightly held St Kilda Road precinct.

Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> and built by <a href="https://www.apartments.com.au/builders/hickory">Hickory</a>, Victoriana places residents between one of Melbourne's most recognised parklands and the CBD, offering oversized two and three-bedroom apartments aimed at owner-occupiers seeking a genuine alternative to a traditional family home.

The development comprises 232 completed residences alongside a suite of resident amenities, including a 25-metre indoor swimming pool, gymnasium, landscaped entertaining areas, resident lounges, EV charging, secure basement parking and a concierge-style arrival experience.

[smartcode_project:default project_id=1979 project_image_fid=363229]

The apartments have been designed with owner-occupiers firmly in mind.&nbsp;Open-plan living and dining areas flow onto generous balconies framing views across Albert Park Lake, Fawkner Park, the Royal Botanic Gardens and the Melbourne skyline.

Kitchens feature Gaggenau appliances, stone benchtops and generous preparation space. Bedrooms include built-in robes, while bathrooms feature full-height textured tiling. Hardwood flooring and ducted air conditioning complete residences designed for long-term living.

Rothelowman's architecture takes its cues from the landscape opposite the site. Sweeping horizontal glazing references the movement of Albert Park Lake, while generous balconies and expansive glazing strengthen the connection between the apartments and the surrounding parklands. The result is a building designed to deliver the scale and amenity expected of luxury apartment living, while offering the larger floorplans increasingly sought by owner-occupiers.

[smartcode_project:default project_id=1979 project_image_fid=363284]

The location is one of Victoriana's defining characteristics. Positioned on Queens Road, residents are directly opposite Albert Park Lake and within easy reach of Fawkner Park, the Royal Botanic Gardens, South Melbourne, St Kilda Road and the CBD. With few comparable development opportunities remaining in the precinct, buyers are increasingly placing value on outlooks that are unlikely to be interrupted by future construction.

Greg Huxley, Founder of Equitifund, believes those qualities become even more valuable over time.

"Premium real estate has always rewarded buyers who take a long-term view," Huxley said.

"Victoriana represents the kind of asset that's increasingly difficult to recreate today, particularly in an established location like Queens Road."

He said rising construction costs are also changing the way buyers assess completed developments.

"When you combine an irreplaceable location with thoughtful architecture and premium finishes, you create something that becomes increasingly difficult to reproduce as construction costs continue to rise."

[smartcode_project:default project_id=1979 project_image_fid=363228]

According to National Sales Director Ben Hamblett, enquiry has been driven largely by Melbourne downsizers and buyers upgrading from smaller apartments.

"Interest in Victoriana continues to build, with strong buyer focus on the larger owner-occupier residences within the development," Hamblett says.

"Enquiry is increasingly driven by local buyers who recognise the rarity of what's on offer: park-facing apartments in an established neighbourhood where new development opportunities are becoming increasingly scarce. At Victoriana, the view is not just a feature; it's an appreciating asset in its own right."

He said interstate enquiry has also strengthened as buyers reassess Melbourne's position within the national property cycle.

"Melbourne currently stands as the most compelling entry point of any major Australian capital, and discerning buyers are beginning to recognise what those who move early always understand: the best opportunities are taken before the price rise confirms them."

[smartcode_project_cta:default project_id=1979]

Why now is the time to buy in Melbourne's premium apartment market

Developers and apartment buyers have a narrowing window of opportunity before Brisbane's Olympic infrastructure pipeline begins competing directly with residential construction, pushing up costs, tightening labour supply and making new projects increasingly difficult to deliver.

While Brisbane's apartment market continues to benefit from strong population growth and limited housing supply, industry research suggests the years leading up to 2027 could prove to be the most important period for developers looking to secure builders and buyers hoping to purchase before the next wave of price increases.

A new Colliers report, Brisbane 2032 Olympic and Paralympic Games: Creating Solutions, highlights the scale of the challenge. While thousands of new homes are planned across South East Queensland, the Brisbane Olympic Athletes Village alone will deliver more than 10,500 beds during the Games before being converted into around 1,750 to 2,000 apartments. Equivalent to almost two years of typical inner-city apartment supply, the project will also absorb a significant share of the construction workforce and building materials.

The broader construction pipeline paints an even clearer picture.

Construction Skills Queensland's Horizon 2032 report forecasts Queensland's annual construction pipeline will average $69 billion over the coming years before peaking at $75 billion in 2027-28. Demand for construction workers is expected to increase by 17 per cent to almost 150,000 people, with the industry facing an annual shortfall of around 19,000 workers that could blow out to as many as 35,000 during the peak construction period.

The Olympic venues, athletes village and supporting infrastructure will account for billions of dollars worth of work across South East Queensland through to 2032, creating intense competition for labour at a time when Australia's residential construction sector is already under pressure.

[smartcode_project:default project_id=150489 project_image_fid=373834]

Colliers Queensland Residential Director Andrew Scriven said the convergence of these projects is creating a clear window of opportunity for both developers and buyers.

"From 2027 onwards, the market will shift dramatically," Scriven said.

"Labour will increasingly be locked into government-led infrastructure and Olympic projects, which means private residential developments will face higher costs and tighter margins. The developers who move now are the ones most likely to get projects off the ground."

Scriven said the same dynamic would also affect buyers, with fewer apartment projects expected to launch once construction capacity tightens.

"If you're looking to change your lifestyle over the next five years, now is your window of opportunity to buy."

[smartcode_project:default project_id=150713 project_image_fid=373827]

Developers are already positioning themselves ahead of that window.

Following the success of Monarch at Toowong, Consolidated Properties is preparing to launch two new Brisbane apartment projects in the second half of 2026. They include <a href="https://www.apartments.com.au/new-apartments/gloriette-30-bedivere-street-yeerongpilly-qld-4105">Gloriette</a> at Yeerongpilly Green, a 25-storey tower within one of Brisbane's key Olympic precincts, and <a href="https://www.apartments.com.au/new-apartments/castile-47-skyring-terrace-newstead-qld-4006">Castile</a>, a recently approved 25-storey riverfront development at 47 Skyring Terrace in Newstead.

Hutchinson Builders will deliver both projects, with early works already underway at Yeerongpilly and Newstead expected to commence later this year.

The timing comes as Brisbane's fundamentals continue to strengthen, with strong interstate migration, population growth and vacancy rates remaining below 1.5 per cent.

Colliers Queensland researcher Pragya Sharma said Greater Brisbane is forecast to require around 40,000 new apartments between 2021 and 2031.

"There's a real mismatch emerging between when housing is needed and when it will be feasible to build," Sharma said.

"As a result, the period leading up to 2027 presents a key window of opportunity for developers to secure approvals, funding and construction capacity, while buyers will have greater choice before supply constraints intensify."

Colliers research outlines a critical pre-2027 window to start residential projects before labour squeeze: now is the time to buy

Developers, buyers on watch in South East Queensland ahead of construction crunch: Colliers

It's taken less than nine months for developer Sherpa Property Group to sell out all 51 apartments in its <a href="https://www.apartments.com.au/new-apartments/flourish-oasis-palm-beach-7-9-sixth-avenue-palm-beach-qld-4221">Flourish Oasis</a> development in <a href="https://www.apartments.com.au/developments/palm-beach-qld-4221">Palm Beach</a>, over a year before its anticipated completion.

&nbsp;

Located at 7-9 Sixth Avenue, the $67 million development has resonated strongly with both local owner-occupiers and downsizers seeking high-quality apartments within walking distance of the beach, dining precincts and everyday amenities.

[smartcode_project:default project_id=151449 project_image_fid=357458]

Christie Leet, Founder of <a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Group</a>, said the sell-out reflected both the strength of the Palm Beach market and the success of Sherpa's community-first approach to development.

"The sell-out of Oasis is a fantastic outcome and reinforces the strong demand we're seeing for thoughtfully designed apartments in lifestyle locations," Leet said.

"From the outset, our vision was to create a development that genuinely enhanced the Palm Beach community while providing residents with exceptional homes and wellness-focused amenities.

"We've been incredibly encouraged by the level of local support throughout the campaign, 72.5 per cent of buyers are locals, with a significant proportion of purchasers choosing Oasis as their future home rather than an investment."

[smartcode_project:default project_id=151449 project_image_fid=357463]

Construction is now progressing following development approval, with trusted builder LPS Group delivering the project and completion anticipated in Q3 2027.

Oasis forms part of Sherpa Group's successful Flourish collection, which has become recognised for its focus on wellness, community and elevated coastal living.

[smartcode_project:default project_id=151449 project_image_fid=357469]

Residents will have private access to a rooftop amenity space featuring a pool, gym, sauna, steam room, hot and cold plunge pools, spa and barbecue facilities.

"The success of Oasis demonstrates that buyers continue to prioritise quality, location and lifestyle," Leet said.

"We are proud to have delivered a project that has resonated so strongly with the market and look forward to bringing Oasis to life for our future residents."

Sherpa recently launched <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a>, its third instalment of the Flourish brand in Palm Beach following Flourish Oasis and <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>.

[smartcode_project_cta:default project_id=151449]

Sherpa sells out Flourish Oasis in booming Palm Beach

Urban Property Group's <a href="https://www.apartments.com.au/new-apartments/la-vera-macquarie-park-94-talavera-road-macquarie-park-nsw-2113">La Vera</a> is leading the next phase of Macquarie Park's residential evolution, with the new apartment development set to become the first of several new apartment projects in the precinct to complete.

The 169-apartment building has now topped out ahead of its scheduled completion in the third quarter of 2026, as new residential investment continues to reshape one of Sydney's largest employment hubs into a true mixed-use precinct.

[smartcode_project:default project_id=134951 project_image_fid=368645]

Cox Architecture has designed La Vera to capture the best of its unique positioning on Talavera Road, orienting the building towards Lane Cove National Park.&nbsp;The building features a sculpted northern façade with flowing curves inspired by the surrounding landscape, while its city-facing elevation adopts a more structured architectural expression to maximise skyline views.

"The vision for the project was to conceive a building that adopted an organic and curvilinear form to the northern portion that faces the Lane Cove National Park," <a href="https://www.apartments.com.au/architects/cox-architecture">Cox Architecture</a> Director Felipe Miranda said.

"The residents that reside in the northern portion of the building benefit by having beautifully crafted curved balconies that speak to the natural context and heighten the relationship of their internal living spaces to the external balconies."

[smartcode_project:default project_id=134951 project_image_fid=358802]

La Vera offers a diverse mix of one, two, three, and four-bedroom configurations, with prices currently starting from $740,000. Buyers so far have been a mix of Sydney-based investors,&nbsp;metro commuters, owner-occupiers and downsizers from surrounding North Shore suburbs.

Both investors and owner-occupiers have been drawn to La Vera's proximity to Macquarie University, Macquarie University Hospital, Macquarie Centre and the Sydney Metro, infrastructure that supports both strong rental demand and a convenient lifestyle for residents.

The apartments feature full-height glazing, timber flooring throughout living areas, stone kitchen benchtops, SMEG appliances, floor-to-ceiling bathroom tiling and ducted air conditioning.

Residents will have access to a rooftop recreation level featuring a swimming pool, sauna, barbecue facilities and landscaped relaxation areas, complemented by additional communal space at ground level. Many apartments enjoy uninterrupted views across Lane Cove National Park, reinforcing the project's connection to its natural setting.

[smartcode_project:default project_id=134951 project_image_fid=364551]

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a>, a family-owned developer and builder with nearly four decades of experience, holds a 4.5-star iCIRT rating and was Australia's first developer to introduce 10-Year Latent Defects Insurance (LDI). La Vera is the first apartment development in <a href="https://www.apartments.com.au/developments/macquarie-park-nsw-2113">Macquarie Park</a> approved to offer the additional insurance protection, alongside a five-year warranty on SMEG appliances.

Urban Property Group CEO Patrick Elias said the additional protection reflects changing buyer expectations in the off the plan market.

"Consumers are a lot more weary and a lot more concerned in buying off the plan than they ever have been. Having LDI is a tool to portray the confidence that we have in our product, and a confidence we want buyers to share," Elias said.

Following completion of the building later this year, buyers will move into their apartments well before Christmas.

[smartcode_project_cta:default project_id=134951]

Staff reporter

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