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17 September 2018

Introducing the New Commercial 3 Zone – an Employment Zone with a Twist of ‘Res’

It has long been a criticism that the Mixed Use Zone is actually a residential zone and, given ‘dwelling’ is an as-of-right use, there was limited ability to retain employment generating uses where the zone was applied (given the stronger market for residential development). It was for this reason many traditional inner-employment precincts, like Cremorne and parts of Fitzroy and Collingwood, were placed in the Commercial 2 Zone, where ‘dwelling’ is a prohibited use.

ratio: had previously advocated to the former Department of Planning and Community Development (now DELWP) that a new zone should be introduced which primarily had an employment focus, but which allowed for some ‘residential’ under limited circumstances. It was of concern to us that traditional employment areas like those mentioned above would fall into disrepair, and that a limited amount of ‘residential’ development was required to enable urban renewal and improvement. By doing this, we argued the employment values of the area would be maintained and enhanced, and the areas could become truly ‘mixed use’.

We had stopped pursuing this with DELWP and the City of Yarra (given our interest in Cremorne) because the upsurge in the ‘office’ market had driven the urban renewal and reinvestment that we now see in places like Cremorne. 

DELWP has just announced that identified ‘clusters of creative and technology jobs’ in Victorian areas (such as Cremorne) will be strengthened by a new planning zone and policy to support Enterprise Precincts. Minister for Planning Richard Wynne recently launched ‘Unlocking Enterprise in a Changing Economy’ at a new business in Cremorne – which they have dubbed the new ‘Silicon Yarra’.

[As an aside, our decision to implant ourselves in ‘Silicon Yarra’ puts us with some prestigious company – including MYOB, Seek, and the REA Group].

It’s said the ‘Enterprise Precincts policy’ will support jobs growth in areas already attracting emerging economy businesses. It includes the new tailor-made employment zone ‘Commercial 3’, which will be implemented in places like Cremorne, Collingwood, South Melbourne and Brunswick.

We have reviewed the new ‘Commercial 3 Zone’ and believe it has merit. Notable features include:

  • Repeated reference to the primary purpose of the zone being for ‘employment and economic development’ with a ‘mixed-use employment’ focus.
  • Including ‘Dwelling’ and ‘Residential building’ (other than ‘Residential aged care facility’) as discretionary (permit required) uses provided:
    - The combined gross floor area of all dwellings and residential buildings (as a percentage of the combined gross floor area of all buildings on the lot) does not exceed the maximum allowable gross floor area percentage specified in the schedule to this zone (with the default being 35%, and the maximum allowable being 50% - presumably at the host Council’s discretion).
    - Any frontage at ground floor level does not exceed 4 metres.
  • Having ‘Industry’ (subject to conditions) and ‘Office’ as as-of-right uses.
  • Allowing ‘Shop’ use up to 200square metres.
  • Exempting most applications to construct a building or carry out works from the usual notice (advertising) requirements (unless, for example, with 30m of a residential zone etc).
  • Requiring that consideration be given to matters such as whether residential use/development is complementary and appropriate to the area (and does not undermine the primary employment and economic development focus of the area), and whether dwellings or residential buildings are designed to effectively mitigate amenity impacts from non-residential uses (including noise, odour, vibration and other associated amenity impacts).

Whilst the zone emphasises the ‘primacy of non-residential uses’, we note there are other provisions which require that consideration be given to matters such as ‘impacts on existing uses’. Given the pockets of residual dwellings in areas like Cremorne, it’ll be interesting to see what weight is given to the inevitable impacts on the amenity of these properties (noting VCAT had previously virtually discounted this as a relevant consideration/impediment to development, given they were a ‘non-conforming use’).

All-in-all we think the Commercial 3 Zone is a good initiative and should be welcomed.

Further Reading


Author: David Crowder, Director: Planning


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