Archive for the ‘infrastructure’ Category


Sustainability: A high stakes game

September 16th, 2009 by Kaitlyn Scannell

There is risk involved in any new development, but it’s a matter of how much risk we are prepared to take.

Pracsys has done a lot of financial analysis to determine whether various sustainable technologies, such as recycled water, are viable compared with current methods, such as traditional scheme water, in the developments of the future.

There is no doubt we need to embrace alternative technology; the problem is the capital costs associated with these technologies are often very high.  Add the fact that current technology is so heavily subsidised and the comparative cost really starts to add up – and the stakes get higher.

In making investment decision does the developer risk short and medium returns in the knowledge that cashflows will be positive in the future? Alternatively do we sit on our hands, watch and wait and hope that such technologies become relatively more affordable once others pave the way and economies of scale are achieved?

No-one wants to be the first to jump, the one to pay a premium for taking that leap of faith. Particularly given that we’re talking about the basics that everyone should have access to – water, power, transport. If the end user doesnt percieve the full value of these technologies then the developer will need to subsidise the price to make it attractive to market.

If Government, for example, were to embrace sustainable alternatives, who would pay for it? Would it put the basics beyond the reach of lower income residents?

There are some advantages in being the first to take the leap, to set benchmarks for others to follow. Water is a scare resource in Perth; it’s a fact that we need a more sustainable method of water supply.

recycled water

The trick is to strike the right balance between the  risk and the benefits, both economic and environmental, of such action. And this means Governments making some hard decisions, working to sway public opinion on issues such as recycled water, and ultimately being convinced that they should take a chance, even if the figures don’t stack up in the here and now.

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Posted by Kaitlyn Scannell Tags: , , , ,
Posted in Feasibility, Innovation, News, infrastructure | 1 Comment »


Don’t develop in isolation

August 28th, 2009 by mknight

Having access to land for a development or precinct is one thing; knowing what to do with it is a whole other ball game.

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?

land-development

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.

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The role of States in our economic recovery

August 3rd, 2009 by Shawn Day

Australian Governments at Federal and State level face a huge challenge.  Having synchronised their policy settings to lead the way to economic recovery through deficit spending, they face two important questions: 

Firstly, how do they know what to spend it on?  

Put another way, how should Australia’s Government sector determine what economic projects are worth spending scarce public resources on?  Australia’s economy is functionally in recession, and market signals are very weak.  What sort of governance framework should be used to guide the identification and prioritisation of economic projects, programs and policies? 

Secondly, how do they acquire the capacity to spend it? 

While the Government sector is stepping into the breach left by the retreating corporate sector, there are limits to how much deficit spending can be sustained by Australia’s economy, and there are organisational limits to Governments’ capacity to actually spend it.  What might this mean for the structuring of government portfolios?

The State Governments of Queensland and New South Wales adopted similar sorts of tactics when they announced their budgets for 2009/2010.

Firstly, the States decided to spend more.  Their gross borrowings will grow to $18bn and $15bn respectively in 2009/10 to fund infrastructure and capital works of $18bn each (see Economics and Market Research).  Transport, utilities, health, education and housing are the big winners.

Secondly, the States are consolidating their civil services into “super departments” (13 each in NSW and QLD), to achieve operational efficiencies and integration and to ramp up their capacity to deliver the promised infrastructure programs. 

Queensland has gone one step further, bringing 13 departments under six clusters.  Thus the Departments of Infrastructure & Planning, Transport & Main Roads, and Employment, Economic Development and Innovation cluster under the Employment & Economic Development “mega-portfolio”. 

The challenge in NSW and QLD is to refocus the strategic and operational efforts of multiple departments towards a unified end. This is a particularly tricky task in the complex and multi-dimensional field of economic development. 

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Posted by Shawn Day Posted in News, infrastructure | No Comments »


Directions 2031 takes Perth a step forward

July 10th, 2009 by Kaitlyn Scannell

By 2031, it is estimated another 556,000 people will be living in the Perth and Peel regions. Population growth brings with it myriad challenges, not the least of which is how to accommodate the extra bodies and cater for their needs.

Planning WA recently released Directions 2031, a new strategy for land use planning, for public comment.

It takes up where the previous government’s Network City left off. A pivotal moment in planning, the 2004 policy produced a range of aspirational ideas for the city’s future. Directions 2031 moves into the area of more measurable goals, although it falls short on detail.

Perth is rapidly heading down the path of endless sprawl, but Directions outlines the need to curb this in favour of a connected city with much better public transport. It proposes increasing the average density per hectare in greenfields from 10 dwellings to 15. Critically, it proposes that 47 percent of this urban growth be infill development – more than 120,000 new dwellings in the inner and middle suburbs.

This is not unrealistic but it will require fundamental changes in the way we think, live and plan for the future. 

Perth is not prepared to embrace density; quite the opposite in some inner suburbs where it is vehemently opposed. It won’t be easy to convince a population used to the quarter acre block model to downsize.

The building and development industry will also have to adapt – look at smaller blocks, more town houses, better use of public open space.

So, too, utilities and other key infrastructure. Will, for example, the water authority be able to cope with extra demand in the infill, assuming there is even room for such developments? 

There are ways to steer development in a certain direction, with the strategy proposing limits on land supply in certain areas and changing density zoning in others.

But Directions 2031 leaves a lot to the market at a time when the market is not really ready for change. This is a step in the right direction but does it go far enough? We need more detail about how the government proposes to fulfill its aims and reach its targets. If it wants Perth to head in a different direction, it is going to require more than a little political will.

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Posted by Kaitlyn Scannell Posted in Feasibility, infrastructure | 1 Comment »


Breaking the data deadlock

July 9th, 2009 by Georgia Moore

There is a lot of money being thrown at infrastructure around the country to move the economy along. But is it the right infrastructure in the right areas for the right reasons?

One of the biggest problems in determining the answer is a lack of data – and the lack of a consistent and transparent way of measuring available data to make evidence-based decisions. 

Without standardisation it is difficult to compare, benchmark or integrate information. People just aren’t speaking the same language or are reluctant to learn how to communicate.

A conference in Melbourne recently, State of the Cities: Unlocking the Data, highlighted how critical good research data is to the success of cities. Data is not merely facts and figures, used properly it can enable improvements in three key areas:

  • Productivity
  • Liveability
  • Sustainability

But what is being done to ensure that an evidence-based system for collecting, compiling and sharing essential data is adopted across the board?

Government departments have in the past been opposed to giving out information, stating privacy issues or concerns that the data would be used inaccurately.

However, the more information is publicly accessible the greater the opportunity to be efficient and proactive; the greater the opportunity for collaboration and innovation. 

This is particularly important for long-term sustainability. To get an accurate and holistic picture of the sustainability of everything from housing and employment to the environment (and how they interact), you need a better understanding of indicators, how they should be measured and compared.

It is all very well, for example, to proclaim Perth or Melbourne as one of the world’s most liveable cities, but why is it so? Such statements regularly grab the headlines but there is little if any discussion of how the researchers reached that conclusion. What measures did they use? What does the data really say? Is it an accurate assessment?

There are many different people and bodies gathering data but no real central governance of the issue that is so critical to our future. Infrastructure Australia, the Federal Government’s new national approach to the development and implementation of infrastructure, is a step in the right direction. Funding for the Cooperative Research Centre for Spatial Information (CRC-SI) will be another important step. 

But it is vital that everyone comes on board, and understands the value of quality, timely data – to make good decisions and to measure society’s progress.

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Posted by Georgia Moore Posted in Innovation, infrastructure | No Comments »


Planning change for the better

May 20th, 2009 by mknight

Anyone familiar with the classic Westerns knows that when the big guns come riding into town, that town is in for a real shake-up. Whatever the outcome of the inevitable shootout, come sun-up life will have fundamentally changed.

Things might be a little more civilised in 21st century Western Australia, but outsiders can still wreak havoc if townsfolk are not prepared for the onslaught of change. 

Broome is a town at the crossroads after the State Government announced James Price Point, 60km north of the tourist hotspot, as the site for the Kimberley liquefied natural gas (LNG) hub. 

As big guns go, this is right up there — a multi-billion dollar driver industry that will have a profound impact on the communities of the Kimberley, and Broome in particular. Just how these communities emerge when the construction stage dust has settled depends on the planning for the arrival. Town planners and policy makers cannot be reactive, they must be proactive.

There is no doubt that with such a major piece of infrastructure on its doorstep Broome will experience a massive demographic change. The nature of the project attracts a far more diverse workforce than is currently the case. The industry and employment base  of the town will expand substantial, as will the resident population with the incoming people likely to expect more particular lifestyle options and amenity levels than has been the case up to this point.

Some town planners tend to think, ‘well, have we got enough land to cater for this influx of workers’, and once they’ve sorted where they’re going to put them, and whether the utilities are adequate, they move on. 

But land is only part of the equation. If a town like Broome is to profit from the arrival of the big guns it is essential to adopt an integrated planning strategy that considers everything from the changing employment base and residential requirements to environmental sustainability.

The scale of this project will position Broome as the major centre of the Kimberley  well into the future, but only if the planning is done properly. For lessons in how not to do it, planners, governments and community leaders need only look a little further south, to the Pilbara town of Karratha.Karratha is dominated by the resources sector, indeed it is the reason for its existence, but the general planning for the town across the board has tended to be reactive and ad hoc. One of the negative results of this approach is the fact that the tourism sector in Karratha is virtually non-existent, a situation that will take a long time to rectify.

And Broome has more to lose. It has a strong tourism base, the impact of an overheated local economy could be catastrophic long term. The planning strategy must consider how it can retain what is good about the town without losing sight of the need for change. This doesn’t just happen, it has to be planned.

Whatever the shelf life of this driver industry, planning must not only factor in how to accommodate the changes it will bring over the duration, but how the community will cope once it’s gone. When the big guns move on to the next town, as they inevitably do, those left behind want to be able to celebrate the changes they brought, not mourn what might have been.

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