When planning cities, governments introduce zoning regulations to organise what is appropriate to build in which areas. For example, it may be inappropriate to build a big polluting industrial warehouse next to a primary school or public green space. Another example may be building a warehouse that will require significant truck and road infrastructure in the middle of a suburban neighbourhood with quiet streets not designed for large vehicles. When large developments are built, it requires a combination of investment from the public and private sectors to ensure the infrastructure is sustainable for the project. Therefore, it is important for developers to organise Section 94 contributions for large projects to ensure the costs are available upfront to improve public infrastructure.
What are the different zone types?
After the industrial revolution, a lot of cities began accelerating the process of dividing urban areas into specific areas for different purposes. Governments and urban planners organised cities into zones; regions for industrial use, commercial use, residential use, green space, public space, high density, low density etc. While most quiet suburban streets are simply zoned for residential and busy main streets/ shopping centres are zoned for commercial, some areas are zoned for both. This is called mixed-use zoning.
Examples of mixed-use zoning?
An example of mixed-use zoning could be a double-storey fish and chip shop with a unit on top of a large inner-city office complex with apartments above and retail shops at the ground level. If the building/ region has a variety of uses, the area it occupies will be classified as suitable for mixed-use development.
Most suburban residentially zoned areas allow for small businesses to exist if they can operate out of a house-like space – dentist, hairdresser, milk bar/ small grocer, kindergarten etc. However, businesses that require large deliveries or create lots of road and foot traffic are usually organised in areas together so that the infrastructure can support them. Inner-city suburbs usually have a lot of mixed-use areas given they usually have more limited space, increased demand, higher density, and thorough infrastructure (public transport, water, sewerage, footpaths).
When an area becomes mixed-use, it not only becomes an area frequented by those living there but a destination for others. The introduction of more people to an area may put pressure on public and council facilities. Therefore, large mixed-use developments require Section 94 contributions to address the cost of the project for private developers and council facilities.
Benefits of mixed-use developments
Mixed-use developments have an array of benefits for communities, developers, governments, businesses and more. They are a great way of utilising space efficiently and increasing foot traffic to local businesses by having people living, shopping, and working within proximity. Increasing the flexibility and foot traffic of the space makes the area more friendly to businesses, especially retail, hospitality, and office-based companies. This can make a mixed-use neighbourhood incredibly self-sufficient and greatly increase a sense of community. People will be far more likely to frequent a business if it is a 3-minute walk away than a 20-minute drive.
Governments and councils benefit from mixed-use development as they can reduce car dependency and road infrastructure requirements if everything is within walking or cycling distance. It also helps centralise infrastructure, by reducing sewer tap-ins and unifying services like electricity and water. By requiring less new infrastructure, this can benefit private developers as the Section 94 contributions may be less expensive. Developers can also benefit by utilising the multiple revenue streams and the ability to organise long-term lease contracts for commercial clients as a way of diversifying their portfolios to hedge against economic volatility. Due to the community benefits, mixed-use developments can improve the value of neighbourhoods greatly, providing opportunities for significant capital gains for developers if enough mixed-use development is occurring within a suburb.
Drawbacks for Mixed-use developments
Drawbacks of mixed-use developments can include an increase in noise and space in an area. The living spaces in mixed-use developments are usually smaller than detached family housing. However, this instead offers more flexible living arrangements for people that are not looking for the quarter-acre block. Due to the inherently more complicated nature of mixed-use developments, it can be more difficult for proposals to be approved. As with all large developments, they will most likely require public infrastructure investment. Therefore, these types of projects can take a long time to plan, design and go through all the council requirements, such as Section 94 contributions.
Section 94 contributions to mixed-use developments
As mentioned, mixed-use developments may change your developer requirements for Section 94 contributions. At Section 94, contact us to organise Section 94 contributions for your developments, and will ensure your development progresses smoothly, without inaccurate and excessive budget hurdles. There is no point in paying excess costs and fees unnecessarily.
With over a decade of industry experience, our qualified building quantity surveyors are AIQS certified with a fast turnaround time and clear communication. Give us a call today at 0413 953 869 or email us at info@section94.com.au to discuss our quality budget services for residential and commercial builds.