By Adam Carey
A dormant high-rise housing project – derisively dubbed the “Ormond Sky Tower” when plans for it emerged eight years ago – has been revived as the latest in a string of build-to-rent projects for Melbourne.
The tower was first planned to reach 13 storeys above largely low-rise Ormond, rising from a concrete platform the Andrews government built over the Frankston line train tracks when it removed the North Road level crossing in 2016.
The revised plans for the Ormond station development would rise to 10 storeys at North Road and six storeys elsewhere.
It was to have been the first example of value capture from the government’s multibillion-dollar level crossing removal program and one of the tallest residential buildings in Melbourne’s south-east.
But it was later shaved to 10 storeys after the Coalition and the Greens joined forces to block the development in a rare parliamentary revocation of a state government planning approval.
The proposal includes 288 build-to-rent homes and a supermarket.
The purpose-built concrete platform above and next to Ormond station remains empty despite a new planning permit being granted to developer DealCorp in 2021.
But DealCorp now hopes to revive the project as a mixed-use development with almost 300 rental apartments, office spaces, a ground floor supermarket and several smaller stores.
Amended plans lodged with the Department of Planning last year and obtained by The Age reveal DealCorp wants to build a 288-unit building which would rise to 10 storeys above Ormond station on busy North Road and to six storeys where it extends into quieter residential parts behind the station. The development would have 514 parking spaces and 289 bicycle parking spaces.
DealCorp director David Kobritz said construction cost increases of about 50 per cent over the past few years had rendered the original build-to-sell project financially unviable. Trying to sell the apartments to investors or owner-occupiers could take years in the current market, increase costs and jeopardise the project’s viability yet again, Kobritz said.
“So we think build-to-rent is the correct option,” he said.
He hoped construction on the project, which would cost more than $200 million, would begin this year and be completed by 2027.
Melbourne’s apartment market is unique among Australian cities in that the number of new build-to-rent developments in the pipeline has overtaken traditional build-to-sell developments.
Kobritz said this was due to rising costs and flat sales.
The City of Glen Eira opposed the original “sky tower” in 2016 and the scaled-down 10-storey version approved in 2018. But current mayor Simone Zmood said it made sense to support population growth where there was easy access to public transport, shops and services.
“We think it’s important to get the balance right between the inevitability of population growth – and with it, higher density housing – and the neighbourhood character our residents know and love. This is what we’ve done through our structure plans, created through conversations with our community,” Zmood said.
The concrete area above the tracks at Ormond station.Credit: Wayne Taylor
She said the Ormond station proposal was being led by the Victorian government, with minimal council involvement.
Ormond was not included among the first 25 train and tram zone activity centres where the state government is poised to seize planning controls to encourage greater housing density.
Liton Kamruzzaman, an associate professor of transport at Monash University, has studied how the government’s level crossing removal program has changed land use around each site.
Kamruzzaman said the program had not led to a housing boom so far and was a “missed opportunity in terms of urban regeneration”.
Ormond station.Credit: Wayne Taylor
Analysis of land use changes at 13 level crossing removal sites found a significant increase in commercial activity within 100 metres of each site, a significant increase in open space and a rise in car parking availability. But the proportion of residential land had fallen almost 30 per cent.
“There is a missed opportunity because huge investment is going on there on the transport side; with a little bit of impetus from the government on the land use side you would see much more integrated development,” Kamruzzaman said.
The Monash University study found that level crossing removals in which the tracks were lowered, such as at Ormond station, produced the least change in land use, while elevated tracks spurred more.
“Overall, the [removal program] resulted in more open spaces, parking and commercial land, while the relative proportion of residential areas showed a pattern of reduction,” the study said.
“In addition, the [program] achieved an increase in pedestrian and cycling lanes to replace railroads on the ground. These changes are expected to enhance the living environment for residents around the case sites.”
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