Solving the “Zero Vacancy” Crisis

Sydney’s industrial vacancy rates have hovered near 1% for years. By allowing intensification, the policy unlocks opportunity for additional supply without needing more land.

Acknowledging “Urban Services”

The policy finally treats “urban services” (the concrete batching plants, waste transfer stations, and mechanics that make a city run) as essential infrastructure. By categorising them as Regionally Significant, it protects them from being pushed out by residential developments.

Evidence-Based Flexibility

The “Retain and Manage” policy was often criticised for being too inflexible. The new Locally Significant category allows for a sensible exit strategy for sites that no longer serve a modern industrial purpose.

The “Last Mile” Conflict

While the policy protects big hubs, it is less clear on last mile logistics (small delivery hubs in suburbs). As e-commerce grows, these hubs are needed closer to where people live, however the policy’s move to allow “Locally Significant” land to become housing might have the unintended consequence of reducing availability of sites which could support such delivery services.

Residential Encroachment Pressure

By creating a pathway for Locally Significant land to transition to housing, the policy may increase expectations about the future redevelopment potential of some sites. This could unintentionally influence how owners manage underutilised or isolated industrial land. Clear criteria and safeguards will be important to ensure that any transitions are based on strategic need and sound planning outcomes rather than speculative pressures.

Vertical Industrial Buildings

The intensification of industrial uses through multi‑storey and high‑density built forms is well established in highly urbanised, land‑constrained cities such as Singapore and Hong Kong. In these contexts, multi‑storey industrial buildings commonly reach 12 storeys and can exceed 20 storeys, demonstrating the scale of vertical industrial typologies achievable in dense environments.

Singapore’s Master Plan 2025 actively promotes higher‑intensity industrial redevelopment through plot‑ratio enhancements, enabling ramp‑up factories and mixed‑use industrial business parks. Its expanded Land Intensification Allowance further supports multi‑storey DfMA (Design for Manufacture and Assembly) facilities and vertical logistics operations. Hong Kong similarly uses multi‑storey industrial buildings to consolidate low‑density brownfield uses and modernise logistics, particularly in the Northern Metropolis.

These international precedents show how planning controls, especially increased height and floor‑space‑ratio allowances, can directly enable industrial‑land intensification, and offer an example of tools which could be explored in the Sydney context.