New Melbourne suburbs come with big promises, but will the infrastructure eventuate?

New Melbourne suburbs come with big promises, but will the infrastructure eventuate?
New Melbourne suburbs come with big promises, but will the infrastructure eventuate?

Christmas has come early to Melbourne this year – the Baillieu government has opened up a Melbourne sack of goodies and granted the promise of a new suburb in the wilderness of Werribee “East”.  In case you think it’s going to end up like one of those other outer-suburban zones, lacking the adequate infrastructure to support the 17,000 new residents, don’t worry!  Planning Minister Matthew Guy has promised 50,000 jobs and around $10 billion worth of investment into providing a “new freeway interchange, residential areas, and industry hubs”.

The idea is to move jobs out of the city – keeping them “local” – and a sterling idea it is.  All agree that we simply can’t keep everything centralised forever.

Families with children are Melbourne’s biggest buying demographic – they need houses (not apartments) gardens, green areas and local schools.  They need community facilities, a local doctor on hand, good public transport systems and nearby shopping centres – and they need it all at an “affordable” price range.  Could Werribee East be an answer, I wonder?

The Victorian government has got a lot on its plate at the moment.  Aside from Werribee East, it is in the process of developing the new Fishermans Bend precinct  – our new “high-rise” metropolis, which Guy assures will be more successful than the soulless Docklands, which apparently is still only “half completed”.

The initial rush of investors who bought into the Docklands developments when they were spruiked on the open market some 10 or so years ago were left sitting on a pot of negative equity and expired “rental guarantees”.  The suburb still maintains a high vacancy rate (currently 8.3%, according to SQM) and as a suburb lacking in family community facilities (schools, churches, and so forth) it only attracts a narrow demographic of professional couples and office workers, which is one key reason the location lacks “soul”.

The worrying part of Docklands was the way it was initially marketed.

Purchasers bought in buoyed by the promise of a new 220-hectare site made up of: “luxury waterfront living, cafes, restaurants, a state-of-the-art stadium, a high technology park, and many other attractions”.

Financial and property advisers pocketed healthy fees from developers who paid them to push unwitting local and foreign investors into speedy purchases.

It’s not an uncommon practice – many still work under the guise of giving “independent” property investment advice principally marketing off-the-plan and new units – the key difference being, if you’re not paying for the information, someone else is – usually the developer.  Hence why ASIC is currently ringing the alarm bells over a new rush of property acquisitions as part of self-managed super fund accounts which all but promise to ‘underperform.’

I don’t have to go into the details of why high-rise developments make poor investments – I have written enough in the past to make it abundantly clear.  As the City of Melbourne aptly described on its website back in 2011, most of proposed new blocks are “relatively small one- and two-bedroom apartments largely targeted at the student market and owned by investors”.

And judging from the high vacancy rate, they are doing little to provide affordable accommodation for the home buying or rental demographic.  However, in Guy’s own words, high rise is apparently good for the city, as “taller buildings ... are a symbol of a growing nation, a strong economy, and they do have the ability to define a city".

Of this there is no doubt – however, as with many tall buildings, the lights may be on, but all too often no one is home.



Back to “Werribee East”, and the government states it will use the revenue from land sales to build the promised infrastructure.

No doubt this will be achieved via hefty development overlays that disproportionally inflate the underlying cost of the land for home buyers.  The success of the plan requires attracting a substantial round of investment into the area initially, and if history is the judge, by the time it gets to individual lot sales, it will be done via a range of incentives that will encourage home buyers to relocate buoyed up on promises that read like a holiday brochure of McMansion delights.

There is absolutely nothing wrong with the main thrust to the suburb – designed through a “vision” of residents working close to home with ample accessibility to their local town centre and community services (thereby avoiding a two-plus-hour commute in nose-to-nose traffic on inadequate road networks for an eight-hour slog in Melbourne town).

Nothing wrong at all – except, of course, it’s all been promised before.

In a report earlier this year issues such as respiratory problems, abuse of alcohol, depression and various other mental and physical diseases were highlighted as common problems in poorly designed “fringe” housing estates lacking in community facilities – facilities that were often sketched in on the initial “master plans” but failed to achieve the necessary funding to realise their potential.

Currently our outer-suburban new estates are amongst the fastest-growing suburbs in Australia. Areas such as Wyndham City and Whittlesea North in Victoria, along with Ipswich in Queensland, Camden in Sydney, and Wanneroo in Western Australia are just a few of the fringe localities that are all outperforming in the population stakes.

Point Cook, a suburb of Wyndham, was promised to be a “a thriving neighbourhood ... just 22 kilometres from Melbourne” with “convenient access to established schools, shopping, recreational facilities and public transport.”

However, fast forward to 2012 and Bill Forrest, director of advocacy with the Wyndham City Council, is now reporting ''They [the state government] have not kept up with schools, they have not kept up with arterial roads, more than 50T of Point Cook is more than 400 metres from a bus stop.''

Surely it would be a better investment to fix one suburb’s infrastructure woes before promising the same delights for “Werribee East?”



According to reports, Werribee East will have new bus connections but no rail. Why would they need it? After all, as Matthew Guy comments, the idea is for everyone to have local jobs – so no need to travel into the city.

It will take years – if not decades – to attract significant investment to achieve the local employment dream for 17,000 new residents.

Furthermore, unless you want a gated community of residents without the diversification of young professionals who work in the city, a fast train link directly to Melbourne would be the one ingredient to attract additional demand overnight while the “local” job plan was evolving.

Furthermore, a train link to Melbourne opens up the freedom to attend football matches and experience inner-city day and nightlife and ensures outer-suburban home buyers remain connected to the wider Melbourne community.

Bus doesn’t work – it’s slower than taking the car and not a viable alternative unless it’s got the word “school” written in front of it.

Unfulfilled promises are a frustratingly common feature of politics. You would never get away with it in a business – the concept of which follows the premise of “promise less, deliver more”.

No so with our state governments – how many out there possess old Melways editions full of dotted lines where proposed train lines and roads had been promised?

Some of Melbourne’s non-existent train lines were initially mooted as far back as the 1890s – and following numerous feasibility reports that amount to millions of arguably wasted dollars, we may as well just watch re-runs of Thomas the Tank Engine for a little solace.

Possibility the biggest bone of Melbourne’s contention is lack of a direct rain link to Tullamarine airport, which – if reports in this week’s newspapers are anything to go by – is already planning a $500 million third runway.

However, once again, the proposed “east-west” runway has been ‘dotted’ in the Melways for over 10 years and if/when it does get built, passengers will disembark from the 900 km/h A380 only to be ushered into a queue to catch the local bus into the world’s most liveable city.

Apparently, a direct train link to Tullamarine is currently in the feasibility stage, and a proposed train link Melbourne’s Avalon airport is currently seeking a reported $250 million to reach fruition. Add this to the $30 billion required for Fishermans Bend, the $10 billion to “complete” Docklands, and the $10 billion for our new western “wilderness” capital – coupled with Victoria’s current economic outlook, which is suffering from a fall in construction and the high Aussie dollar – and any vision of thriving new neighbourhoods should probably be more correctly termed pipe dreams.

Catherine Cashmore is a market analyst with extensive experience in all aspects relating to property acquisition.

Catherine Cashmore

Catherine Cashmore

Catherine Cashmore is a market analyst with extensive experience in all aspects relating to property acquisition.


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