Alarm at residential trend in central city
MELBOURNE might be the world's most liveable city with its cafes and laneways, but its long-term "workability" is in question with projections showing twice as many apartments as offices will be built in the city centre over the next four years.
Analyst Charter Keck Cramer's projections show 313,355 square metres of office space will be built from 2013 to 2016 in Melbourne's central city region - the CBD, Docklands, St Kilda Road and Southbank.
Over the same period 13,105 apartments (at a conservative estimate of 50 square metres each) will be built, occupying 655,250 square metres of space.
CKC director Robert Papaleo said developers had focused so heavily on residential projects in the past decade that, if this leaning continued, it could damage "the economic vitality of Melbourne" allowing residential development to permanently displace traditional commercial sites.
Melbourne's continued economic growth required a vibrant commercial centre with "new-generation office floor space" that met the needs of business, he said.
But Colliers national director of office leasing Andrew Tracey said it was important to look at what a mature economy would do.
Central Melbourne had been evolving, both commercially and residentially, since the early 1990s when "older more obsolete commercial buildings were turned into residential projects", as part of Postcode 3000, he said.
Apartments were not "taking over" from commercial developments. "You'll find the market has a way of sorting these things out; economically things have to work," he said.