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Victoria’s New Commercial Zones_____

Victoria’s New Commercial Zones

The Department of Planning and Community Development has today released the final text of the 2 new Commercial zones which will replace 5 existing Business zones in Victoria's planning schemes.

This follows the announcement on Monday 6 May by Planning Minister Matthew Guy that the new Commercial zones will commence on 1 July 2013 as the next phase of reform of the State's planning system.

The Commercial 1 Zone (C1Z) will create opportunities for mixed-use centres including retail, office and commercial uses with the potential for higher-density residential growth.

The Commercial 2 Zone (C2Z) will be a "flexible employment-only zone", designed to accommodate appropriate office, industrial, bulky goods retailing and other commercial services, including - with some important limitations - "small scale" supermarkets and shops.

Some notable differences exist between the final text of the new zones, and drafts released earlier this year:
  • The new Commercial 1 Zone will preserve caps on office and shop leaseable floor areas in "rural municipalities" by translating existing limits into a schedule to the new zone. Floor space caps will not otherwise be allowed in the new Commercial 1 Zone (for example, in metropolitan Melbourne).
  • Residential use in the Commercial 1 Zone will not require a planning permit, as long as ground-floor frontage does not exceed 2 metres.
  • The new Commercial 2 Zone will allow for "small scale" supermarket use without a planning permit, but only within Melbourne's Urban Growth Boundary. The maximum leaseable floor area for this "as of right" supermarket use will be 1,800 square metres (instead of the 2,000 square metres provided for in the earlier draft zone).
  • In addition, for "as of right" use as a supermarket within the new Commercial 2 Zone, a site must adjoin, or have access to, a road in a Road Zone (generally, an arterial or other major road).
  • A supermarket larger than 1,800 square metres may be developed within the Commercial 2 Zone within Melbourne's Urban Growth Boundary, subject to a planning permit being obtained.
  • In regional areas, a supermarket larger than 1,800 square metres will not be allowed within the new Commercial 2 Zone.
  • Residential use in the Commercial 2 Zone will generally be prohibited (the earlier draft allowed some kinds of residential use subject to a planning permit requirement).
These changes to the final zones as announced seem to respond to some of the concerns that have been raised about the potential for adverse impacts from isolated or "out of centre" retail development, particularly for regional areas.

Transition from Commercial to Business zones

The Commercial 1 Zone will replace existing Business 1, Business 2 and Business 5 Zones. The Commercial 2 Zone will replace the current Business 3 and Business 4 Zones.

Tract Consultants - New Commercial Zones
Land use provisions

The new Commercial 1 Zone (C1Z) seeks to encourage mixed-use retail, office and higher-density residential centres with the following land use provisions:
  • Office and Retail land uses (including Supermarkets) will be allowed without the need for a planning permit to be obtained.
  • Residential uses will be allowed without the need for a planning permit (except that where residential uses have a frontage of more than 2 metres at ground-floor level, a permit will be required).
  • Use of land for industrial processes which are recognised as having potentially adverse impact on nearby land will be prohibited.
Where existing floor space caps for these uses exist within a "rural municipality", they will be preserved by being translated into schedules to the new zones. Otherwise, floor space caps will not apply.

The new Commercial 2 Zone (C2Z) is intended to further the creation of commercial employment precincts which may combine office and industrial uses, bulky goods retailing and other commercial services:
  • Office, Restricted retail (which includes many kinds of bulky goods retailing) and Supermarkets (up to 1,800 square metres in leaseable floor area) will be allowed without the requirement for a planning permit. This "as of right" use for a Supermarket only applies if the site adjoins or has access to a main road (a road in a Road Zone) and is within Melbourne's Urban Growth Boundary.
  • Shops will be allowed without a planning permit, but must adjoin a Supermarket, must not exceed 500 square metres combined leaseable floor area and must have access from a road in a road zone. Otherwise, a planning permit is required.
  • Residential use of most kinds is prohibited, with limited exceptions such as a motel or residential hotel, which are subject to a planning permit requirement.
  • Industrial use is allowed without a planning permit, unless it has recognised potential to adversely affect nearby land - in which case a permit will be required.
Changes to 3 industrial zones - Industrial 1, Industrial 2 and Industrial 3 - will also be implemented on 1 July 2013 for consistency with the new commercial zones.

The Industrial 3 Zone will be revised to accommodate the retail use of land on a similar basis to the new Commercial 2 Zone - that is, a Supermarket of up to 1,800 square metres, and adjoining Shops of up to 500 square metres, without the need for a planning permit, as long as the site adjoins, or is in close proximity to, a road zone, and (in the case of a supermarket) is in metropolitan Melbourne.

If these conditions are not met, the shop or supermarket use will be prohibited within the Industrial 3 Zone.

Implementation

The new zones will be implemented with effect from 1 July 2013 by a state-wide planning scheme amendment.

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