Noosa Council rejects Affordable Housing Proposal amidst a Housing Crisis

I am NOT a Property Developer….

Noosa Council refused our planning application on Thursday after a protracted negotiation period. https://www.youtube.com/watch?v=b1G4yJwQ8fg

The link above is to the streamed Council Meeting, our application is discussed around the 1 hour 6 minute mark. If the link doesn't work please Google Noosa Council YouTube 16th September 2021.

If you managed to get through the 20 minute debate, you will understand why I am NOT a property developer.....I don’t have the ability to reconcile and cope with the lack of common sense, red tape and bureaucracy that defies logic and the stamina to continue jumping through newly created imaginary hoops. Particularly when our proposed scheme is trying to address a critical shortage of new small dwellings whilst adding four new Specialist Disability Accommodation apartments in a town centre location with convenient access to transport, services and amenity amidst a chronic housing shortage.

Where is the logic.....

Prior to demolition, the site was historically 100% residential and was zoned Community Services until the new town plan rezoned the site into the District Centre zone, with on old lapsed approval for 16 residential apartments approved in 2015.

We purchased the site 5 years ago and we hold a current DA for 10 two bedroom residential apartments and 720m2 of commercial floor area. Covid19 onsite prompted us to review our plans given the total lack of interest in our commercial space, work from home trends and high long term commercial vacancy rates in Tewantin town centre. Despite holding six EOI’s on the apartments at the time, we could not justify building the project with 40 car spaces required for the $4.5m commercial space that no one wanted.

In late 2019 we entered into a sale contract with the State Government who was looking to purchase or JV residential development sites as part of the Housing Construction Jobs Program. After months of DD, the State pulled out of the contract when Noosa Council advised a 100% residential scheme would not be supported on our mixed use site.

In late 2020, I presented to Noosa Council and executive staff about housing affordability issues that were beginning to emerge and the pressure it was placing on our local businesses and community. The Council owns two adjoining sites to the east and west of our site and the State Government also owns a small adjoining parcel of land. If Council wanted to pursue site amalgamation and plan a major social housing project I was all ears!!

In early 2021, we amended our project plans to replace approximately 500m2 of unwanted commercial space with four SDA apartments and added new ground floor commercial and retail options and lodged our revised DA in February 2021. Given the carparking requirements for residential are much less than commercial, we were able to decrease the basement size and increase the total GFA. I believe we balanced the highest and best use of the site whilst maintaining a code assessable application and complying with the Town Plan.

Our legal and town planning consultants' interpretation of the Noosa Town Plan supports our assertion that our project is ancillary to and supports the predominant business functions of the District zone, and that over 90% of the current Tewantin District zone is used for business / commercial purposes. Council does not support our position despite there currently being only 8 residential units within the District Centre. Adding another 19 residential units above ground level will not undermine the primary commercial purpose of the zone. In fact we are adding four new businesses to the zone with preferred ground floor exposure and access.

The council have refused to acknowledge the ambiguity in the wording of the Town Plan and have insisted that we need more commercial space to receive a favourable outcome and be recommended by Council staff as an acceptable scheme. No particular percentage of Residential vs Commercial mix was advised or outlined in the Town Plan, the Council advice was that we just don’t have enough commercial space for the application to be supported.

Interestingly in March 2021, Council started the process of a proposed amendment to the Noosa Plan to include this site in the Community facilities zone in order to stimulate the provision of small dwellings, social housing and health care services. This decision confirms Council does not believe that this site has a significant role to play in the future business function of the District Centre so why is so much weight being given to proportion of commercial floorspace within the development??

During the planning discussions, (which included a two week delay waiting to speak with Council engineer to explain why our plans surprisingly do not propose water travelling uphill) Council suggested that they may be agreeable to our scheme IF we sign an Infrastructure Agreement locking in the four SDA apartments in perpetuity.

We believed the draft IA was unfit for purpose so we sent Council a Deed Poll stating our terms. Council then instructed their lawyers to prepare a deed of agreement at our cost, with new punitive and uncommercial terms which we ultimately disagreed on. These uncommercial terms included a $500k bond and to keep all four SDA apartments on one title. During these discussions Council insisted that SDA participants were unable to purchase their own homes so they would not agree to allow individual titles. I felt this was discriminating against SDA participants by removing the opportunity to purchase their own property if in a position to do so.

Two days prior to the Council Meeting and after a confusing General Committee meeting, Council advised us that they would instruct their lawyers to amend the deed to reflect our latest conditions on the proviso that we pay for their solicitors to amend the deed, despite there being no assurances the councillors would accept these terms. We declined, they refused our application and now we go to P&E Court.

Sign the deed or we will recommend refusal.....

Below is a summary of the 11 proposed protection mechanisms from the Deed:

1. Four apartments must be used exclusively for SDA for a minimum of ten years
2. The SDA homes must be designed and constructed to comply with the NDIS SDA Design Standards
3. The SDA Dwellings must be enrolled with the NDIS & the Owner of the subject site must enter into a written service agreement with a SDA Provider, to the satisfaction of the Chief Executive Officer, prior to commencement of construction of any part of the approved development.?
4. The SDA Dwellings must remain on a single title, and must not be subdivided into individual or separate strata titles until after the expiry of the 10 year timeframe
5. Prior to commencement of the use of any part of the approved development, the Owner must enter into a preservation covenant with Council to ensure that the SDA Dwellings are used exclusively for SDA by NDIS participants for 10 years. The covenant must be on terms acceptable to Council, prepared at the cost of the Owner, and registered on the title for the SDA Dwellings prior to the issue of a certificate of classification or building final for any part of the approved development.
6. The Applicant must enter into a written agreement with Council to establish the responsibilities for and secure the performance of conditions of this development approval.?The terms of the agreement must be on terms acceptable to Council, prepared at the cost of the Owner, and executed by the parties within 10 business days of the development approval taking effect.?
7. Ensure that an SDA assessor is engaged at the design stage of the SDA dwellings in compliance with the SDA Standard.
8. Ensure that all certifications identified are obtained from a SDA assessor.
9. Pay a security bond of $500,000 for 10 years (Council reduced to $100k for 5 years) and must be paid within 90 days of DA.
10. Provide right of access to the property for Council to ensure the use is being complied with.
11. Council is required to provide written consent to dispose of any or all of the SDA dwellings once they have been construction and we must satisfy Council that the buyer is respectable and capable of complying with the owners obligations and provide a signed deed from the buyer agreeing to the Deed terms. Council can withhold their consent if they believe the buyer does not have adequate skills or ability to comply with the Deed

Clearly there are more than enough protection mechanisms in the deed to provide certainty to Council? It is our plan after all!?

If you were a developer would you accept these conditions? Which terms would you reject?

Has any other QLD Council imposed something like this to achieve a social housing outcome?

Have any of my connections had any involvement in participants purchasing their own property?

To Recap....

Currently we hold an approval with NO SDA apartments in our current DA, we can proceed with this DA and Council receive none of the social housing outcomes they desire, but achieve the 700m2 of unwanted commercial space. Talk about missed opportunity Councillor Wilkie!?! Never mind the fact that State Government would have purchased this site for 100% Social Housing Outcomes if Council would relax their mixed use zoning 12 months ago.?

I would be interested to obtain any feedback from community housing providers, SDA participants, SIL providers or developers within the industry, please feel free to contact me on 0414 535 451 or email [email protected]

Chris Wright