Beyond reigniting the debate on the merits and feasibility of a light rail system, the proposal has also sparked perhaps what is a more interesting debate…

“Assuming that Perth should have a light rail system, how should it be staged?”

Before any really constructive debate can take place, it is necessary to identify what economic, social and environmental metropolitan planning objectives a light rail system would serve. This in turn will inform the criteria for identifying and prioritising routes.

One of the primary objectives of Directions 2031 is to achieve a more accessible city through a more balanced distribution of population, dwellings and employment across the metropolitan area. This involves:

• Improving the employment self sufficiency of the outer sub-regions
• Increasing distribution of new residents and dwellings to the central sub-region
• Improving the efficiency and effectiveness of public transport

Like many of the numerous studies and academic reports on a future light rail system for Perth, the above proposal focuses on the latter two objectives, to the exclusion of the first, and arguably the most significant for the development of a sustainable city.

Beyond the Central Sub-region, Perth’s major activity centres are ineffective in delivering both the quantity and quality of employment growth required to support residential settlement patterns. A major feature of many of these centres is their large footprints, with nodes of activity within them only loosely connected e.g. Joondalup, Rockingham and Mandurah. By providing strong linkages between nodes and acting as an impetus for the activation of land between nodes, light rail can be considered economic development infrastructure. While it won’t be the panacea to the imbalanced distribution of employment in Perth, it has the potential to be used to develop the value proposition outer metropolitan activity centres need to attract high quality employment. Integrated public transport solutions for outer sub-regional Activity Centres can potentially:

• Promote greater intensity of activity
• Encourage diversification of activity
• Assist centres to develop economies based upon local comparative advantage

There is an enormous opportunity for a light rail system in Perth however without understanding the role that it can play in the achievement of metropolitan planning objectives, we risk developing a system that simply perpetuates the status quo.

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It is not simply a case of “build it and they will come”. If it is not planned correctly from the beginning, a development can quickly become a costly white elephant.

Pracsys is undertaking the economic analysis of a site next to the Mandurah train station which Landcorp would like to buy and develop over the next 10 years.

A transit orientated development (TOD) is directly impacted by transport, but there are broader issues than the traffic passing through. The fact that people are coming and going from an area does not necessarily make it a viable concern.

Planners need to determine what the site can bear in terms of residential development and, therefore, commercial and retail.

 The relationship between retail and residential development is relatively straightforward: the former is generally driven by the latter. Less clear is the relationship between residential and commercial space.

It is pointless to park a lot of commercial floor space without understanding what it would mean to the immediate area and surrounding region. How much commercial floor space is currently available, what is it used for and how functional is it?

The viability of a new precinct needs to be examined within this context. What would the development add to the area? Who will be attracted to it, what can it support and what will drive demand? How would it be connected to other precincts in the region?

There must be a specific strategy in place to ensure the viability of any development before a sod is turned. The number one lesson is: Don’t develop in isolation.

Will Perth get extended shopping hours? Will the shops stay open until 7pm or 9pm? Whatever way the politicians go (no referendum for this one), there is certain to be people unhappy with the decision.

But it is worth noting that even an hour’s extension in the time we have to shop will bring real benefits to our activity centres, be it the Perth central business district or  suburban shopping centres.

As it stands, Perth operates largely mono-cultural activity centres that are heavily dominated by retail – a series of shopping malls surrounded by a sea of carparks. When the shops shut, the carparks are soon emptied, with little if anything to hold customers there past 5.30 or 6pm.

In the city, the shops shut and before you can say ‘but I haven’t done my shopping’ there is a mass exodus of people heading out of the CBD. Activity grinds to a halt. 

Any increase in trading hours will immediately increase the overlap between shopping and socialising, such as heading out to restaurants or the movies, and will result in greater interaction of diverse uses, thereby invigorating activity centres. 

A good shopping district open later will attract more restaurants and other entertainment facilities to the area. We would see more multi-purpose centres, with shops, restaurants, bars and cinemas interlinked and feeding off one another.

Rather than rushing to get a few groceries on the way home from work before the shops shut you could catch up with friends for coffee, a drink or an early dinner and then shop at your leisure – or vice versa. 

An extension of retail trading hours will also reduce anti-social behaviour, with more people out and about in areas currently abandoned within half an hour of shops closing.

The longer the overlap between diverse uses the more beneficial for all concerned, but even some overlap is better than nothing. It not only creates more vibrant centres but more sustainable ones, too.

The policy states that it should be read in conjunction with other policies, such as those relating to residential development and employment lands. However, the State Employment Lands Plan deals with traditional industrial land and business & technology parks containing higher order jobs, while the Draft Centres Policy is supposed to cover all retail and commercial employment including ICT, finance and business services.

The policy identifies a network of centres, including local centres to cater for the population, and strategic centres, which are considered crucial to the economic, social and environmental function of the state or region. The latter covers global Sydney; regional cities such as Parramatta; and centres with a special economic function such as airports, ports, universities and hospitals.

Apart from identifying the centres’ hierarchy and ensuring land is zoned appropriately for business uses, the policy does not address important planning considerations for strategic centres, such as:

• Links between knowledge industries and traditional employment lands; 
• Lack of high-order job provision in regional areas requiring long journeys to work; 
• Maximising leverage from investment in infrastructure through co-location.

The policy’s focus on zoning sufficient land parcels for retail and commercial uses does not reflect the need to attract export-oriented and knowledge-intensive industries and jobs to the residential growth corridors.  

Jobs in population-driven industries, such as retail and entertainment, can only do so much to achieve the sustainable development aims of the NSW State Plan, which prioritises increasing business investment in regional areas and providing jobs closer to home.

The bulk of the policy concerns the provision of retail and commercial floorspace, with demand tied to population growth and household spending; and location and scale dependent on assessment against a set of suitability criteria. In terms of population-driven ‘retail-focused’ centres, the policy has many valid points which could enable industry and government to work together to ensure that centres expand and develop in a sustainable way.

In contrast, the Western Australian Metropolitan Centres Policy (currently under review) aims to ensure an equitable distribution of centres so that consumers can access goods and services close to home. However, the use of retail floorspace caps as a method of control restricts overall supply, leads to dispersed retail rather than concentrated centres, does not enable centres the flexibility to innovate and grow in a sustainable way, and reduces healthy competition.

The Draft NSW Centres Policy highlights the importance of flexibility and competition in creating the most benefit for consumers, with people able to make choices based on factors such as price, convenience, access and quality. It advocates:

•  Responding quickly to consumer demand;
•  Letting the market determine the need for additional floorspace;
•  Allowing the planning system to assess development applications on external costs and benefits, rather than demand (or arbitrary retail floorspace caps).

Further examination of how to measure the economic, social and environmental costs and benefits of a development is required. This is particularly important for the sustainability of a centre in terms of opportunities for working close to home, public transport accessibility and the ability to access a diversity of activity with one trip. 

It is also vital that when determining the economic or net community benefit of a retail development, the importance of employment in higher-order export or knowledge industries is prioritised. This will ensure that strategic sites are maintained as valuable employment lands, crucial for long-term economic development.

A vibrant airport is crucial to being competitive in such a market. We need to get away from the idea that airports are simply places where people fly in and fly out and turn them into strategic employment activity centres – multi-purpose areas that deliver on a number of levels.

Airports rely on aeronautical revenue, such as landing fees and passenger charges. But if that is all they draw their revenue from, they will never be competitive.

Those that adopt other non-aeronautical uses, such as retail, introduce extra income streams and ultimately may even be able to drop charges for airlines. All airports are competing to draw airlines to their hub – those offering a better value proposition will have the edge.

The idea of an airport city, or wider aerotropolis, is taking shape around the world, with bustling centres realising the benefits of developing an airport that has many characteristics of the CBD.

At Changi Airport in Singapore, about 100 million passengers pass through per year with an estimated spend of $28 per head – or $2 billion a year in revenue. Smaller domestic airports in Australia, such as Perth, are estimated to attract around $9 a head.

Passengers are a captive audience, with many having to spend hours at an airport waiting for the next flight. The more attractive their surroundings, the more likely they are to spend up while they wait. In conjunction with the higher average income of airline passengers, this means that retail sales in major airports can be up to three times greater than shopping malls, with JFK airport in New York turning over an average of $18,000 per square metre in 2007.

Amsterdam doubles as a shopping mall with retail, an art gallery and fitness centres; Changi has cinemas and saunas; Bangkok is building a golf course; and Dubai Central is spending $42 billion on office towers, a mega-mall, golf course, as well as residential accommodation for airport workers.

There are also competitive advantages in locating different types of businesses in or near the airport precinct. The economy is more mobilised and the success or otherwise of many companies often depends on how quickly they can deliver goods. Manufacturing firms that rely on high speed delivery are off to a flying start if they are within quick access of the airport.

Global companies, too, are becoming increasingly aware of the benefits of locating regional head offices near the airport. Research shows that high-tech professionals are travelling a large proportion of their time because they know the knowledge-transfer and networking benefits of being face to face with clients and colleagues, but they waste precious hours getting to and from airports. An office located near the airport enables executives to fly in, carry out a two hour meeting and fly back out. 

Authorities need to designate the airport as a very important employment sector and activity centre, and develop public transport that delivers to that area. The demand for employment land at airports in Australia is already increasing, particularly around Australia Trade Coast in Brisbane, and to a lesser extent in Perth where mining services have clustered for access to mines in the State’s north and south. However, Australia has yet to experience anywhere near the level of investment in commercial office, hotels, conference and leisure facilities and supporting residential development for airport employees that is happening globally.  

We must focus on what we should do with this surrounding land to maximise competitive advantages, and airport masterplanning currently occurring in many Australian cities must begin with a strategic employment plan. Putting up a billboard advertising available land is not the answer. The area will fill up with non-strategic businesses and the markets the economy wants to capture will simply fly elsewhere.

Residential development is growing rapidly in the coastal suburbs of the North West and South West corridors, yet working residents have no major employment base (on a metropolitan scale) within the region and many must travel to the inner sector each day for work.

To attempt to alleviate the problems of urban sprawl and low employment self-sufficiency in outer sectors of the Perth Metropolitan area, there are three potential areas of focus for the planning system.

1. Increasing residential density in the inner and middle sectors enables people the choice to live in closer proximity to their place of work. This also maintains a focus on the CBD as the primary strategic employment centre in Perth, strengthening industry and employment to compete with other capital cities in the global economy.

2. Boosting transport infrastructure spending to improve existing rail and bus services, as well as adding new services, enables people living in regional areas to efficiently and effectively access their place of work.

3. Targeting specific strategic industries or new projects in the outer sector, and improvement to supply chains for existing industries, increases the diversity and number of businesses locating in the sub-regions where the largest residential population growth occurs. This results in a net increase in high quality job share for outer residents.

A combination of these three approaches is required to achieve the best and most feasible results for the Perth Metropolitan area. Increasing residential density in inner areas can only contribute so much to solving the problem due to land constraints, affordability and differing views on what constitutes ‘lifestyle’. However, a dedicated focus on achieving Network city aims may bring about opportunities for increasing density in inner urban areas on existing public transport routes with good access to amenity centres.

Improving or adding train and bus services can reduce private time and monetary costs involved in travelling to work each day. However, provision of train lines and stations is costly and constrained by the large public sector investment required. In addition, evidence from around Perth shows that even in areas reasonably well-serviced by public transport, often less than 30% of commuters will actually use this method of travel.

Completely decentralising strategic employment away from the Perth Central Area diminishes agglomeration benefits for businesses, including economies of scale for specialisation and trade; proximity to clients, suppliers and competitors for spontaneous innovative exchanges and face-to-face networking opportunities; and proximity to specific infrastructure such as universities and transport hubs. This market behaviour makes it difficult to encourage industries to locate in outer local government areas without a concentrated effort to make the move beneficial.

Agglomeration benefits can be fostered on a smaller scale in regional centres; however they need a critical mass of activity to be successful. This requires certain centres to be designated ‘strategic’ – as places in which strategic employment is encouraged and closely monitored and prioritised in terms of transport and infrastructure spending.

Decision rules about which centres should assume this role must be agreed upon and made explicit under the Activity Centres Framework. These can include factors such as an existing employment base, physical infrastructure or natural advantage and relative return on investment.

Decisions as to the types of industries to target should also be made on a region-wide or preferably state-wide basis. This supports specialisation and the development of economies of scale, reduces the need for major infrastructure duplication and allows specific industries to be fostered in the regional area with the greatest existing or intended advantage.

Weighing the financial, social and environmental costs and benefits is a necessary step in determining how much of each approach should be implemented. How can we measure and prioritise these factors?