Business leaders call for tax incentives to revive city centre
For more than a decade, growth in Geelong has continued apace. The outer suburbs of the regional city expanded rapidly, covering previously open green areas.
Construction of a new convention center on the glittering coast, drawing more than $450 million in government funding, is nearly complete.
There is also a healthy demand for luxury apartments with bay views. Greater Geelong’s reputation as the destination for quality casual dining is growing, especially on its stylish streets.
But parts of the Geelong CBD are barren and unloved, creating an urban hostility that becomes a deterrent for businesses and people. There are long sections with empty storefronts.
That’s why local civic and business leaders, with the council’s support, are pressing the provincial government to create a special economic zone that provides tax incentives to downtown developers.
Geelong Committee chief executive Michael Johnston said the city needed greater housing density to help absorb some of the rapid population growth.
“What needs to be done in the next phase is housing development,” he said. “Currently, we see that market conditions are conspiring against this.
“In our opinion, this is the magic solution to making things happen in central Geelong.”
The state government has a target to build more than 128,000 homes in Greater Geelong by 2051. But Johnston said construction in central Geelong was more expensive than in Melbourne, making it uninhabitable.
The City of Greater Geelong is asking the state government to provide land tax breaks, stamp duty concessions and application fee exemptions to encourage development.
They are also calling on the federal government to help finance priority projects and provide GST rebates. Geelong Mayor Stretch Kontelj said the council was willing to provide rate relief on capital improvement values and permits for new projects.
Greater Geelong’s population surpassed 295,000 last year, compared to almost 271,000 in 2021. But Kontelj said only about 2000 people lived in Geelong’s CBD, although up to 20,000 people could be housed in housing up to 20 storeys or higher.
Kontelj said the CBD had been “a bit maligned” but insisted more people living there would make it more attractive.
He cited council figures showing 17 permits had been granted for CBD developments, but said these had not been delivered due to the cost of construction.
Kontelj said the main streets, including Moorabool and Ryrie streets, were supposed to be “magnificent boulevards” of boutique shopping, but instead there were many empty shops.
“On the surface this looks like a crisis, but the reality is that this is a transition period because developments are taking place, especially in the hospitality space.”
Some of these problem areas are centered around Market Square, which has long stubbornly resisted redevelopment.
The state government’s Central Geelong Framework, published last year, said both Market Square and the nearby Westfield shopping center could be transformed with a maximum building height of between 42 and 60 metres.
In other central heritage locations, the framework recommended maximum building heights between 16 and 28 metres. But crime has been a persistent problem.
Earlier this month, Victoria Police reported that an operation targeting retail theft and anti-social behavior in the city center had resulted in 350 arrests last year.
Geelong Chamber of Commerce chief executive Jeremy Crawford allows his children to cycle freely in his West Geelong neighbourhood.
“There are a few suburbs they can navigate,” he said. “CBD is not one of them.”
Problems include low foot traffic and highly publicized crime, vacant lots are underdeveloped and slow pre-sales on residential development are hindering growth, Crawford said.
“Without density and population in the CBD, it will be very difficult for businesses to continue here.”
Crawford wants the state government to follow NSW’s lead and adopt a pre-sale finance guarantee, under which the state government commits to buying some off-plan housing from developers to reassure lenders.
If the developer cannot sell the apartments on the private market, the government has the option of keeping, renting or selling the apartments.
A state government spokesman said it was already providing incentives to support development, including extending off-plan stamp duty concessions for townhouses and apartments and removing the payroll tax-free threshold.
“We’re making it easier to build more homes in places that are well-connected to public transport, jobs and services, including Geelong,” he said.
But Bill Votsaris, the Geelong-based developer who transformed the Little Malop Street precinct, argued inconsistent height limits in the city center – some as small as five storeys – were a deterrent.
“This is feasible if you are developing a five-storey building on farmland pastures, but construction in the inner city is much more expensive.”
He said the federal government would attract more people to regional Victoria by making rent payments on new residential buildings tax deductible.
“It just means you’re going to decongest Melbourne and create demand in regional Victoria.”
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Benjamin Preiss is regional editor of The Age. He was previously a state tour correspondent and also covered education for The Age.Connect with: X or email.
