Adams, Toby & Solonsch, Mark (7C)

Activity Centres FILLING THE BENCHMARKING VOID

Mark Solonsch – Senior Research Manager Toby Adams – Research Manager

Australia • Asia • Middle East

WHAT ARE ACTIVITY CENTRES?

WHAT ARE ACTIVITY CENTRES?

“ACTIVITIES AREAS ARE VIBRANT HUBS WHERE PEOPLE SHOP, WORK, MEET, RELAX AND OFTEN LIVE. THEY VARY IN SIZE AND TYPE TO PROVIDE A WIDE RANGE OF ACTIVITIES FOR PEOPLE TO GO ABOUT THEIR DAY-TO-DAY ACTIVITIES.”

ACTIVITY CENTRES VARY IN SCALE AND ROLE THEY PLAY IN RELEVANT SUB-REGION

CHADSTONE

ALL ACTIVITY CENTRES HAVE A DIFFERENT MIX OF INGREDIENTS, STRENGTHS AND WEAKNESSES

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OUR PILOT CENTRES SHOW VAST DIFFERENCES IN SIZE

PILOT STUDY 1: RINGWOOD, VIC

PILOT STUDY 2: CASTLE HILL, NSW

RESIDENTIAL NEIGHBOURHOOD QUALITY AND DWELLING DENSITY MATTERS

RESIDENTIAL NEIGHBOURHOOD QUALITY AND DWELLING DENSITY MATTERS

RINGWOOD LOWER PRICED AREA MAKES MEDIUM DENSITY PRODUCT MORE SUITABLE.

CASTLE HILL DESIRABLE NEIGHBOURHOOD WITH VERY LOW DENSITY PROVIDES ATTRACTIVE RESIDENTIAL DEVELOPMENT OPTIONS

RETAIL CONCENTRATION OF A RETAIL CORE IS ESSENTIAL FOR AN EFFECTIVE CENTRE

RETAIL CONCENTRATION OF A RETAIL CORE IS ESSENTIAL FOR AN EFFECTIVE CENTRE

RINGWOOD RINGWOOD’S RETAIL SUFFERS FROM DISPERSION. EASTLAND WORKS WELL, BUT THE LONG STRIPS STRUGGLE.

CASTLE HILL CASTLE TOWERS IS A HIGH PERFORMING CENTRE IN A CONCENTRATED SPACE. THE RENOVATED MAIN STREET CAN LEVERAGE OFF IT.

TRANSPORT ACCESS TO AND AROUND A CENTRE SHAPES ITS FUNCTION

TRANSPORT ACCESS TO AND AROUND A CENTRE SHAPES ITS FUNCTION

RINGWOOD STRONG TRAIN AND CAR ACCESS FACILITATES THIS EMPLOYMENT NODE.

CASTLE HILL A WALKABLE CENTRE WITH WEAK PUBLIC TRANSPORT LINKS.

COMMUNITY A CENTRE MUST HAVE QUALITY AND QUANTITY OF SOCIAL INFRASTRUCTURE

COMMUNITY A CENTRE MUST HAVE QUALITY AND QUANTITY OF SOCIAL INFRASTRUCTURE

RINGWOOD IN NEED OF BETTER QUALITY, NOT QUANTITY OF SOCIAL INFRASTRUCTURE.

CASTLE HILL UPGRADED FACILITIES ARE CREATING A VERY LIVEABLE ENVIRONMENT.

STRATEGIC PLANNING MEASURES WITHOUT GOVERNMENT AND PRIVATE SUPPORT FOR DEVELOPMENT, CENTRES WILL NOT THRIVE

STRATEGIC PLANNING MEASURES WITHOUT GOVERNMENT AND PRIVATE SUPPORT FOR DEVELOPMENT, CENTRES WILL NOT THRIVE

RINGWOOD GOVERNMENT HAS FUNDED INVESTMENT BUT PLANNING CONSTRAINTS ARE RETARDING FUTURE STAGES.

CASTLE HILL ACTIVE PLANNING IS SEEING THE IMPLEMENTATION OF FIRST STAGES OF CHANGE.

COMMERCIAL WORKERS, ACCESS TO THE CENTRE AND AN EXISTING CORE IS REQUIRED

COMMERCIAL WORKERS, ACCESS TO THE CENTRE AND AN EXISTING CORE IS REQUIRED

RINGWOOD A STRONG SUBURBAN PRECINCT.

CASTLE HILL GREAT CATCHMENT IN THEORY, BUT NO SIGNIFICANT TENANTS.

KEY FINDINGS & INSIGHTS

ACTIVITY CENTRES HAVE STRENGTHS AND WEAKNESSES URBIS’ METHODOLOGY IDENTIFIES THESE, SO A CENTRE CAN ADOPT ITS MOST VIABLE STRATEGY TRYING TO BE SUCCESSFUL ON ALL SIX ELEMENTS IS NOT FEASIBLE.

KEY FINDINGS & INSIGHTS

KEY FINDINGS & INSIGHTS ENCOURAGE ACTIVITY CENTRES TO SPECIALISE IN 2 OR 3 OF THE 6 ELEMENTS RATHER THAN DEMANDING THEY DELIVER ON ALL OF THEM. THIS WILL BE THE MOST EFFECTIVE APPROACH TO DELIVER A VIBRANT HUB WHERE PEOPLE SHOP OR WORK OR MEET OR RELAX OR LIVE.

Castle Hill

RINGWOOD

MIXED USE CENTRE

//25KM NORTH WEST OF SYDNEY CBD

URBIS MIXED USE ACTIVITY CENTRE INDEX

MIXED USE CENTRE

URBIS MIXED USE ACTIVITY CENTRE INDEX

//23KM EAST OF MELBOURNE CBD

Overall, Castle Hill has the base ingredients in place to evolve into a very successful mixed use centre. The centre is well located as a ‘gateway to the North West’ – a sub-region which will continue to record significant growth over the coming two decades. The Castle Hill catchment has very good community infrastructure provision and solid medium and higher density residential growth has been being recorded. While the core retail precinct is performing strongly, the commercial component of the centre is disparate and under-performing and the centre requires improved public transport access. Fortunately, the mooted North West Rail link project is scheduled to have a rail station adjacent to the existing bus interchange within 5 years and the addition of the station holds the promise to catalyse private investment across the Mixed Use Centre catchment.

Overall, Ringwood has the bones of a successful mixed use centre, with a strong commercial precinct, good community infrastructure and public transport access.

However, to take the next step, improvements are required to improve the retail offer and stimulate residential development. The $350m QIC redevelopment of the retail precinct will be an important catalyst in attracting further investment across property classes.

OVERALL RANKING

OVERALL RANKING

SNAPSHOT

3

SNAPSHOT

SCORE

(OUT OF 5)

COMMERCIAL

RESIDENTIAL

RETAIL TRANSPORT COMMUNITY

STRATEGIC PLANNING

IMPLICATIONS

To achieve ongoing progress, supportive government policy settings will be necessary and a renewed focus on transport planning and investment and upgrading of community facilities.

2

The commercial offer across Castle Hill is a weak point, with the key issue being the lack of a major office tenant within the centre. The proximity of the centre to the Norwest business park as a competitive location for office tenants is a key reason for the poor performance of Castle Hill across the key commercial measures of office rents, vacancy rates and commercial density.

3

Despite the lack of residential development within the core area of the Mixed Use Centre, when taking into account the 1km catchment, Castle Hill is performing relatively well across the assessed residential measures. The quality of accommodation across the catchment is a strong point which is correlated to solid pricing momentum. While there has been some development of medium and higher density residential development in recent times, the overall residential density of the Castle Hill Mixed Use Centre Catchment remains low. Therefore there is considerable investment potential, mostly in townhouse and other medium density products.

RESIDENTIAL

RETAIL

2

Castle Hill currently records high levels of car dependency, due mainly to very poor public transport provision. The centre does however have excellent connectivity for both automobiles and walking, with the legible grid road network.

TRANSPORT

4

The Castle Hill Mixed Use Centre rates highly on community measures. The Centre has good community infrastructure provision, with the strongest features being the high provision of primary schools, General Practitioners (GPs), local parks, and child care services. Crime rates for the catchment are well below State and metropolitan averages, and there are strong law enforcement resources in place.

2

The Castle Hill Mixed Use centre has some strategic planning challenges, which are having an impact on development activity. While there are modest development constraints due primarily to building height restrictions, the lack of recent public sector investment and low levels of activity clustering within the centre and the broader catchment are more substantive issues hindering private investment.

Castle Hill has clear opportunities for developers, with continuing development of the retail core and residential the stand-out. The strong retail and community infrastructure in the Centre, and above average residential demand in the surrounding suburbs, offer significant scope for heightened levels of medium and higher density residential development. The vision for the Centre in terms of the role it should play in the North West sub-region, including the mooted establishment of a railway station at the Centre, holds a great deal of promise to improve public transport usage within the area, and is likely to further incentivise property development investment across the broader catchment.

SCORE

(OUT OF 5)

COMMERCIAL

Taken as a whole, retail within the Castle Hill Mixed Use centre is currently operating at a relatively strong level. However, while the Castle Towers centre is performing well across key metrics, the other major retail precinct, Castle Mall Shopping Centre is performing very weakly.

The concentration of the retail offer across the Mixed Use Centre is a strong point. A key retail weakness is the paucity of Draw Tenants.

3

3

COMMUNITY

STRATEGIC PLANNING

4

Ringwood scores highly on most commercial office measures but low rents are currently being achieved in the precinct. There is a critical threshold of white collar workers close to the area, and given that the existing office stock is ageing, this will necessitate refurbishment or new development to offer the market a higher quality product.

2

The residential component of the Ringwood mixed use centre is a weak point, particularly the low dwelling density. Generating a higher concentration of residents in the mixed use centre is very important to the success of the area. It is more likely that medium density developments can be encouraged in the first instance, as townhouses may be closer to the expectation of the Ringwood market.

2

Taken as a whole, retail within the Ringwood mixed use centre is currently operating below the level that is expected of a successful mixed use area (apart from Eastland Shopping Centre which trades well). The retail offer is not concentrated in one location, which dilutes its effectiveness and it has a lack of “draw” tenants. QIC are planning a $350m redevelopment of Eastland, and in conjunction with government investment, the entire retail precinct could be revitalised.

4

Ringwood has a railway station and busy bus station, resulting in good public transport access, but, vehicle and walking connectivity are less impressive. The public transport strength of the Ringwood mixed use centre should be leveraged, with a focus on opportunities near the railway station and bus stops. However, there is a need to look closely at the road and walking network.

4

The Ringwood mixed use centre rates highly on community measures. It has no notable weaknesses, with its main strengths being the provision of high schools, General Practitioners (GPs), parks, child care centres, youth services and a lower than average crime rate. Ringwood has an opportunity to leverage its positive community measures, by further improving the quality of community facilities, rather than the quantity.

2

The Ringwood mixed use centre has a number of strategic planning challenges, which may impact on development attractiveness. Development constraints due to building height restrictions and heritage overlays, plus the lack of activity clustering within the centre itself, provide minor barriers for investment. Although these strategic planning issues are relatively small, they are likely to require each project to be carefully assessed, which may slow the overall momentum for Ringwood.

IMPLICATIONS Ringwood has clear opportunities for developers. While it can be challenging to develop successful suburban office precincts, Ringwood has the existing strength in its commercial precinct that can be leveraged. The residential market certainly offers good scope for medium density development, although high density may be high risk at this stage. The entire area will certainly benefit after the $350m QIC development is completed.

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