Why I’m tempted to stop building in Sydney amid planning woes

Harry Triguboff in Sydney. Picture: James Horan

Councils and planning authorities must listen to developers in order to address the housing crisis, as prices will keep increasing unless they act to fix problems plaguing NSW.

I am the state’s largest apartment builder but if I have to waste years building in Sydney, and not in other places, I will not build here except to finish on my empty blocks of land.

The problem is that there is not enough action to back up the official sentiments on housing. I see that our authorities in NSW are promising that production of units will increase, but for this to happen blocks of land for many hundreds of units must be sold.

At the moment, developers don’t have enough money to buy sites, so I believe that governments can rezone whatever they like, but there won’t be action. When authorities rezone land, they must ensure that profit can be made. The basic problem is that they don’t know how to do it, nor do they care. They think they know the answer. That is why we have too many offices and not enough apartments.

Authorities must stop being arrogant and must understand the market. If developers come with problems, they must be helped – not told what the law says. Laws have to be changed very often because conditions change. When making rules and deciding on density, profits must be protected.

NSW Premier Chris Minns in parliament in Sydney. Picture: Christian Gilles/NCA NewsWire

Our developers are going broke more than anyone else. They can’t all be dumb. So I believe authorities must consult with developers, otherwise, we will never catch up with demand.

And investors are still quiet. At present, the income for an investor if he buys a unit is 2.5 per cent net. And this is not exciting.

We sell very few units to investors – they are only about 25 per cent of the market.

For units to be taken by investors, council costs have to be brought down. But the councils have no intention to do that either. So, there will not be much sold for rent. Besides, the banks are refusing to provide finance for builders.

Harry Triguboff,says he has almost stopped buying in Sydney.

So, nobody cares about all these added costs. Everyone wants units to be built, but few will be. Thus, rents will keep going up. The price of units will also go up because there is no supply.

What of the big solution?

We’ve all heard of build-to-rent, but we can’t see it. And we won’t until everyone concerned ensures that costs will be reduced. Unfortunately, both political parties are very happy with this situation. Their advisers give them the same advice. So, people are struggling and employment and spending are down.

This apathy has to stop. I am building more than 2000 a year and could build 4000. But councils fabricate problems for which I would gladly take them to court, but our present rules don’t allow me to do so.

And the planning department is not at all helpful. I have almost stopped buying in Sydney, and I am just using up my empty land.

Of course, we have some councils that are better, but many rules applied to them are awful.

Because I can’t get approvals, I now provide finance to people who are not accepted by the banks, even though I may not be the builder. The result now is that the banks don’t earn much, and neither can the government earn much from housing.

In the last quarter, I completed three blocks of serviced apartments, and I am active in Brisbane and Surfers Paradise. But we need more approvals.

New artist impressions of Meriton’s Cypress development in Surfers Paradise.

It is most interesting to try and understand how much longer they will allow production to drop and for supply to fall further and further behind in NSW.

And prices are rising and rents are going up.

All the planners here (in Sydney) have to do is act normally and I will be back.

But I don’t like my chances.

Harry Triguboff is managing director of Meriton Apartments.