25/09/2007 - 22:00

Red tape rollercoaster

25/09/2007 - 22:00

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Dealing with government may be one of the perennial frustrations of property developers, but the state’s boom has exacerbated this sticking point.

Red tape rollercoaster

Dealing with government may be one of the perennial frustrations of property developers, but the state’s boom has exacerbated this sticking point.

Sector leaders who attended the WA Business News boardroom forum found that planning departments, from the state down to local level, were struggling to keep up with demand.

Pivot Group chairman Peter Laurance believed it was more difficult dealing with local and state governments in Western Australia than it was in other states of Australia.

“The heads of departments are much less accessible here than in most of the other mainland states. A prime contrast would be South Australia, where from the premier down, its absolutely clear that if you can’t see a minister within two weeks and you are an employment generator, then that person won’t be in the cabinet any longer – it’s remarkable how alert they are,” he said.

South Australia, Victoria and Queensland tended to get things done, even though their economies were less profitable than WA’s, Mr Laurance said.

At a local level, it is understood that some councils are under prepared and under pressure to deal with the volume of development applications and procedural requirements.

According to Urban Development Institute of WA executive director Debra Goostrey, the real problems emerged when councils moved from being mainly rural based communities to urban.

“As that urban fringe moves out further, each of those councils is experiencing over and over again, that same problem of changing the psyche of staff and upskilling councillors,” Ms Goostrey said.

Port Bouvard Ltd chief executive Ross Neumann believed local government were increasingly at the mercy of political factionalism and ‘green group agendas’.

“You’ll find some very good planning officers who put up their recommendations only to see councillors not even read the reports or listen to the presentations. These officers, whether they be planners or engineers, are probably the ones being picked up by the private sector. They go where the grass is greener,” Mr Neumann told the forum.

Depending on the type of project, however, a developer’s experience of local government can be quite different.

Major shopping centre developer and Centro Properties Group regional manager WA, Bruce McCully, said that, on the whole, local government in WA tended to be very efficient in dealing with prospective retail developments.

“With a shopping centre, you’re playing with somebody’s social environment so local governments tend to be pretty good. We are generally one of the largest businesses within their communities,” he said.

The biggest problem for the sector was negotiating the size of the prospective shopping centre development with the state government, he said, which in some cases could be considerably expensive and time consuming for the proponent.

In the Perth CBD, meanwhile, the issue of plot ratio entitlements and height impositions by the City of Perth remains a sore point for several developers.

Plot ratio determines the maximum gross floor area allowable on a plot of land.

Mr Laurance said the 5:1 plot ratio was an anachronism which persisted in Perth and not in most other capital cities.

“I think the plot ratio scheme in Perth is ridiculous. It’s not a modern commercial and industrial city where you’ve got 20-storey office buildings,” he said.

“Perth looks like a regional city in Canada, rather than a capital city in Australia.”

When meeting the market demand for large office floor plates of 1,800 square metres and more in size, Mr Laurance said it was unfortunate that new buildings had to abide by plot ratio stipulations because it limited their potential.

LandCorp chief executive Ross Holt said with the challenge with local government in WA remained with individual councils and their inconsistent approach to governance.

“The question is, are they interested in being leaders, or are they processors. If they take a leadership position from the CEO down, you can get things done,” he said.

Mr Holt said a change of mindset was fundamental to the future of both local and state governments.

“Within government now there is an acknowledgement that this boom is not a boom. It’s a step change and therefore you have to think of different solutions. You can’t just say we’ll survive until it’s over, because it won’t be over,” he said.

“So if it’s staffing or systems, you need to deal with it, whatever it takes.”

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