The bust in Sydney's building industry is no bloodbath
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This was published 3 months ago

Opinion

The bust in Sydney's building industry is no bloodbath

Drop the word “bloodbath” into your media release and you can pretty much guarantee headlines across the land. But is it true? Is a 27 per cent step-down from the biggest building boom in Sydney’s boom-bust history really a bloodbath? Or is it a long-needed correction, an opportunity to take stock and rethink?

Admittedly, from the Busselton Mail to the Boorowa News, most of the papers that ran this week’s "Builders warn of looming housing bloodbath" headline hail from a single stable with a discernible agenda. But their shared premise, which governments routinely support, makes the construction industry some beneficent overlord whose current jitters constitute such imminent danger to us all as to justify billions of dollars in public up-prop.

A pause in construction could be time for a reset.

A pause in construction could be time for a reset.Credit:Bloomberg

Indeed, Master Builders Association chief executive Denita Wawn seemed to think it perfectly reasonable, this week, to demand $5.1 billion public dollars in special building industry favours to avoid a “bloodbath” now that “private sector investment is evaporating”. That sum combines a 12-month extension of the $25,000 HomeBuilder renovation grant to prop up residential builders and an additional $3.8 billion version of same for the commercial sector.

But why? The Australian construction industry is surely among the most ruthless, arrogant and self-concerned industries anywhere this side of the law (a line it has been known to straddle). Public benefit? Pah. Developers have to be dragged to it kicking and screaming and, usually, they’re not, which is why our public realm has all the delight and variety of a prison exercise yard. Yet at first sight of their own blood these same schoolyard bullies drop into self-pity, demanding a head pat from nanny and a kiss better. Billions, please, boo hoo.

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Yet even as Wawn claims private sector “evaporation”, Urban Taskforce chief executive Tom Forrest argues that developers are suffering “significant pent-up frustration”. Poor souls, their urge to do good is cruelly limited by a capricious planning system.

The implication, which again governments unquestioningly accept, is that any sieve on the sluice gates – red tape, green tape, height limits, heritage lists or environmental protections – should go. What they’d like is no planning system at all. Just build boys, build.

Somehow no one sees the contradiction here. On one side, our development fraternity is so virile, so fabulously tumescent, so eager to perform that the rules should be stretched to accommodate, max lubrication applied. On the other, that same fraternity is so limp it requires the viagra of public moneys to perform at all.

And somehow both arguments lead, from opposite directions, straight to the need for public help in ignoring the public good; wildly accelerated planning approvals, public lands, public cash.

But again, why? Why wouldn’t we recognise that evaporating interest is a sign of glut, aka bad investment? And although governments exist to make bad investments – in the sense of supporting services that cannot self-support – they should actually be services. Public support should accrue if, and only if, developers build what we want.

What do we want? Probably not the same old same old. Consider Pyrmont. This time a year ago Star casino wanted a 66-storey Ritz-Carlton tower, wildly out of scale with its context, to vie with Packer’s omnipresent priapus across the bay. The Independent Planning Commission, taking its name seriously, said no. Nein. Nyet. What did the government do? Ignoring that its first loyalty is not to developers but to us, it dramatically upzoned the entire peninsula, from Broadway to the point. Then, for good measure, it “streamlined” the IPC, ensuring no such independence recurs.

The Independent Planning Commission knocked back The Star's 
 proposal for a 66-storey tower last year.

The Independent Planning Commission knocked back The Star's proposal for a 66-storey tower last year.

The new “final draft” plan for Pyrmont is a classic instance of the planning style known as Plonkism. In essence, it just rolls out more Barangaroo. Taking as precedent Melbourne’s increasingly tacky Southbank, it hugely increases the commercial nature of Pyrmont, strewing Darling Harbour (the Harbourside and Powerhouse sites), Wentworth Park, Ultimo and the existing fish-market site at Blackwattle Bay with dozens of potential towers up to 50-plus storeys.

Eagerly applying that tired old bean-counter epithet “international” to visitors, competitiveness, students and models, the plan specifically notes Star’s 51-storey Ritz-Carlton (suggesting it’s as good as approved) and Darling Harbour Harbourside market as future high-end shopping spots. Yet, the more they talk up this glossy, wealth-slavering “future” – as though luxury hotels, high-roller casinos and handbags worth more than your mortgage were the stuff of dreams – the more it sounds old-fashioned, almost quaint. Do they really think last-century globalism will emerge on the far side of COVID unscathed? Could they?

Five minutes ago, universities were the high earners, spending endless billions on glamour buildings to attract international students. Now all that built braggadocio sits empty. Universities plead for money and Qantas posts a $1.9 billion loss. Is this really just a blip? Do we even need high-end hotels? Casinos? Office towers? With commuting on hold, do we need motorways like WestConnex, destroying neighbourhoods, but now largely empty?

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Sure, times are uncertain. But buildings aren’t just job creators. The jobs come and go; the objects remain. So wouldn’t a sensible leader consider this uncertainty not a bloodbath but a breather? Wouldn’t they consider the big, obvious question: if we must subsidise construction, aren’t there buildings we actually want? New typologies that actively sequester carbon, create delightful outdoor spaces, enrich our streets, enhance our health, or old ones like quality public housing?

I don’t care if developers invest in outdated buildings. I do care if they use our money, our environment or our land to do it. We’re paying, we should have choice. Isn’t that the first principle of capitalism, you buy what you actually want?

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