City Hub

Risky high-rise faces fast-track approval

Precinct 75 industrial estate, St Peters, Sydney, Australia. Photo: Alec Smart.

By WENDY BACON

St Peters’ residents fear that the NSW Minister for Planning, Rob Stokes, is fast-tracking a development proposal that is based on outdated and misleading information about contamination, aircraft noise, pollution and traffic risks.

The development, known as Precinct 75, is currently a ‘creative hub’ of 70 small businesses housed in old industrial buildings between Edith and Mary Streets in St Peters. The businesses, most of which have been hard hit by COVID-19, include Willie the Boatman brewery, artist studios, a florist, hairdresser and small craft businesses.

Previously the site of an old Taubmans paint factory, Precinct 75 is surrounded by narrow streets of cottages with long backyards and low-rise industrial buildings. The site is contaminated, lies under Sydney airport’s flight path, and is less than half a kilometre from the Westconnex M8 unfiltered stack that is due to open in July.

The developers, which launched Precinct 75 in 2013, are two tiny unknown companies called Chalak Holdings and JKM Holdings. These are the family trust companies of Mays Chalak and Jason Varker-Miles, who both have a significant history of making money out of buying and selling property.

Chalak and JKM Holdings have applied to the NSW Department of Planning, Industry and Environment (DPIE) for a rezoning of the Precinct 75 site so that they can lodge a development application to demolish some buildings and replace them with new commercial and residential buildings of up to nine stories. Of 180 apartments, none are designated as ‘affordable’ or social housing.

The rezoning proposal was rejected by the Inner West Council in 2017. Council’s refusal meant that the rezoning proposal was referred to NSW Planning. The local community, many of whom are strongly opposed to the development, heard nothing more about the development until three weeks ago when they heard that it had been included on Stokes’ second tranche of projects to be fast-tracked through the Department’s rapid COVID-19 approval process.

At around the same time, the Inner West Council (IWC) posted a request for community feedback on a draft Voluntary Planning Agreement (VPA) between the Council and the developers. VPAs are voluntary agreements entered into by a Council and a developer to deliver public benefits after a rezoning or when a later stage development application is getting approval.

The IWC VPA announcement features an unrealistic PR image of the development. It states: “The Planning Proposal was assessed by the NSW Department of Planning, Industry and Environment” (DPIE). This misled the community into thinking that there was nothing more that the community could do. According to DPIE, it is still assessing the proposal and in response to letters from residents, has requested that residents send in submissions by June 18.

Residents are alarmed by serious flaws in the Precinct 75 applications that they say are false or misleading. So City Hub reviewed the planning documents and found that the Precinct 75 proposal not only fails to meet DPIE’s own fast-track assessment criteria but is misleading in other ways.

Aircraft Noise impact on Precinct 75
At intense levels, aircraft noise can impact on health, which is why it is an important planning issue in suburbs like St Peters that lie directly under flightpaths for jets landing and taking off from the usually busy Sydney airport. The guidelines for noise levels are contained in documents called ANEF. Residential development is restricted in areas that fall within 25-30 ANEF.

The ANEF used in the assessment is ANEF 2033 whereas the current guideline is ANEF 2039, which is a response to changes in the flight path.  Under the new guideline, an additional 45% of the site falls within the updated 2039 25-30 contour, making 65% of the site unsuited to non-industrial use. The Minister and DPIE are aware of this issue but have refused to comment. One would expect this flaw to have been picked up by DPIE’s ‘due diligence’ team and a fresh noise assessment required.

Contamination
The Precinct 75 site is significantly contaminated due to many years’ use as a paint factory and for other industrial uses. DPIE’s criteria specifically mention that contamination is an issue that can disqualify a site from fast-tracking. A preliminary contamination assessment of the site found significant contamination by hydrocarbons and asbestos. However, the survey was very limited and did not test some spots where dangerous substances were buried rather than removed after a 1955 fire.

City Hub has seen a concrete slab seal under which is a toxic dump is likely to be buried. This is inside a property on the borderline of the site. A much more thorough investigation report will be needed before the site can be disturbed, especially as the ground may have shifted during WestConnex tunnelling. The earlier expert report that is included deep in the proposal documentation is cautious and notes that there is a ‘low risk’ that further development might not be possible at all.

Missing unfiltered stack development controls 
This site is impacted by two unfiltered Westconnex St Peters Interchange stacks. The closest is the M8 stack due to open in several weeks. The second is the M4/M5 in Campbell Road, which is due to open in 2022.

Every WestConnex approval had a condition that development controls be put in place by Councils assisted and funded by the NSW Roads and Maritime Services (RMS). The conditions were imposed because DPIE, RMS and Council experts had evidence showing that above 10 metres, health risks increase significantly beyond the risks at ground level. (Many argue that they are also unacceptable at ground level). If the stack controls had been in place, they would have placed a serious limitation on development at Precinct 75 or other nearby sites.

The collective failure of DPIE, RMS and the Inner West Council (IWC) to put in a place the development controls required by the WestConnex project approval is a serious lapse in accountability. It raises questions about whether the purpose of the tollway conditions is a feint to facilitate approval rather than a serious condition meant to be applied. Initially, IWC told City Hub that they didn’t know what is happening with the controls. They later added that “Council staff are currently enquiring about the progress of WestConnex New M5 Condition of Approval E29 with the contractor and relevant NSW Government agencies”.

The Inner West Council staff have been aware of this condition because City Hub’s reporter first drew their attention to it in 2018.

Does Precinct 75 meet the criteria for fast-tracking?

Precinct 75 is one of only two Inner West developments in the second tranche of 24 priority projects. The other is the Fish Markets’ site on Bridge Road, Ultimo. “We are fast-tracking assessments to keep people in jobs, boost the construction pipeline and keep our economy moving,” Mr Stokes said.

According to NSW Planning, Precinct 75 would create 320 ongoing new jobs. This must assume that the new and more expensive retail and office spaces that would replace the current ones would be occupied. This claim should at least be tested against reality: hundreds of similar new shops stand vacant, in some cases for years, on the ground floor of similar developments in the Inner West.

As is proposed for the Precinct 75 redevelopment, these empty shops lie beneath high-rise apartment blocks. Given the number of vulnerable small businesses that would need to leave Precinct 75 during construction, it is likely that rather than adding to local jobs, the Precinct 75 plans would lead to a net loss of employment.

As well as creating jobs both before and after construction, the criteria for fast-tracked projects must also demonstrate ‘public benefit’ through new public open spaces or affordable housing.

City Hub asked Mr Stokes and NSW Planning Secretary Jim Betts eight questions about the assessment process that has been applied to Precinct 75. One of these questions related to how losses and gains of jobs are calculated.

NSW Planning declined to answer our specific questions. Instead, it responded with a simple statement in the name of an anonymous “spokesperson” that simply assumes ‘public benefit’ and restates promotional claims about the project that can be easily read on the DPIE website. The statement reads: “If approved, the mixed-use rezoning … would allow the development of a creative industry precinct with commercial and residential uses that will benefit the local community.”

It continued: “Historic industrial buildings would be retained and integrated in the new development that includes a new artists’ studio and community facility with more than 1,600 square metres of publicly accessible open space, featuring pedestrian and cycle links. The rezoning is currently being assessed through the NSW Government’s Planning System Acceleration Program that is supporting jobs and investment during the COVID-19 pandemic. The program does not guarantee project approval – it is simply a faster assessment process. If the rezoning is approved, a development application for the project would then be submitted, which would undergo the same rigorous assessment process as any other proposal.”

Creative hub will be crushed
NSW Planning’s statement failed to acknowledge that Precinct 75 is already promoted by its owners as an exciting  ‘creative hub’ that benefits local craft, sustainable and start-up companies. In September last year, Varker-Miles told a journalist writing a promotional feature for Mercer Property, “We wanted to establish a place where creative businesses could operate. So we weren’t looking for lawyers, doctors and accountants, but the makers, the creators – people that could create a real community. And proudly that’s where we’ve gotten to today.”  But it seems Varker-Miles also has a vision in which much of the ‘Brooklyn-like aesthetic appeal’ that the story celebrated will be trashed to make way for apartments for well-off buyers.

DPIE also does not explain why the proposal includes no affordable or social housing although there is an affordability crisis in the Inner West.

City Hub also asked why the term “community neighbourhood centre” is specifically mentioned in the description of Precinct 75 in the list of fast-tracked projects but does not appear in the proposal documentation. A community neighbourhood centre implies a drop-in centre with paid or voluntary staff. The inclusion of the Community Neighbourhood Centre raises the question of whether the list of features of projects in the list may have been reframed by public relations or ‘stakeholder engagement’ staff to make them appear more attractive to the broader public.

The needs of the St Peters’ community, which has endured four years of WestConnex construction carving up their suburb, are nowhere acknowledged. In assessing the third stage of WestConnex in 2018, DPIE staff acknowledged that St Peters’ residents were experiencing ‘construction fatigue’ as a result of increased heavy vehicle traffic on congested local roads, tunnelling, cracking of homes, poor air quality and loss of their neighbours.

Resident Emma Pierce told City Hub that she is anxious that more years of trucks moving waste and construction materials would only worsen the situation in which it is dangerous to turn from nearby congested Unwins Bridge Road into narrow streets.

St Peters’ resident Janet Dandy-Ward lives in Robert Street, a narrow dead-end street that borders the development. Precinct 75 developers will demolish one rented home and trees in order to create a tiny pocket of open space and a bike and pedestrian route through the commercial zone.

There is a second 600 square metre open space in the middle of the commercial and residential buildings. This would appear to be the limit of additional open space offered by the development. The planning proposal does not mention that there is already a pocket park on Roberts Street.

Dandy-Ward has already written to DPIE arguing that the plan “does not consider local community interest because if this was the case then this project would not have been considered by the Department of Planning as a priority project at all. It has already been rejected by the local council, local businesses and the local community. I am very unhappy about the planning processes including this latest tactic of fast-tracking.”

Uncontactable developers
City Hub wanted to talk to the developers to get their perspective. Mays Chalak lives in a large house near the water at Sandringham. We tried to reach him at his company, GIS Engineering Services. He was not available and did not respond to an email letter sent to his company. Staff said they were not allowed to give out his email or phone number.

At 49, Mr Chalak is an experienced property investor. In 2017, when his Precinct 75 application had already been lodged, he told the Sydney Morning Herald that he was moving away from residential investments because there was more money to be made out of offices. We assume that with the increased use of working from home during COVID-19 in 2020, office investments now look less enticing.

His business partner, Jason Varker-Miles, began his career as an electrician and at 24, set up his own successful consultancy company. Mr Varker-Miles and his wife, property PR expert Trish Varker-Miles, have made millions out of buying and selling property. Not surprisingly their property ventures have been promoted by property journalists.

In 2018, they bought a 5 bedroom home with an outdoor entertaining area and pool at Sirius Cove in Mosman for $5.3 million. Two years before the couple sold their previous home overlooking exclusive Chinaman’s Beach near the Spit Bridge for $10.3 million, which they had bought for $4 million in 2014 and did up for resale with ‘”lots of copper and sandstone”.

They then rented for a couple of years to let the market cool before making what realestate.com described as a ‘savvy purchase”. “We have enjoyed being tenants for a couple of years, it has given us time to look around the market to consider different locations and what we really wanted in a family home,” he told property reporter Jonathan Chancellor.

City Hub couldn’t help noticing that the 1000 sq metre “manicured gardens” that front the Varker-Miles’ Sirius Cove home are far bigger than the 600 sq metre open space in the middle of their St Peters development.

City Hub has tried to contact Varker-Miles. If he responds, we will add his comments.

Inner West Council adds to community confusion

While residents can write submissions to the Minister for Planning and DPIE, they have no rights in the fast-tracking process. They are not even consulted as stakeholders. Although Councils too have been sidelined, they are still regarded as stakeholders. If the rezoning is approved, the Inner West Council will need to consider a development application. There are other controversial fast-tracked projects which also went to DPIE after being rejected by Councils. For instance, some Greens Councillors are campaigning in support of West Pennant Hills residents concerned about losing a forest to a massive Mirvac development. So why have the Inner West Council misrepresented the situation and Councillors remained so silent?

On April 28th, the same day the second tranche of projects were announced, the IWC met and passed a motion moved by the Greens opposing the NSW government’s fast-track process. Similar motions have been passed by other Councils and community organisations associated with the Better Planning Network, that is opposed to the process.

But later in the same meeting, the Council went into a confidential session to discuss several matters including the VPA with Precinct 75. The minutes state that the discussion was closed because it would, if “disclosed, prejudice the commercial position of the person who supplied it.”

A motion to agree to the VPA was moved by Mayor Darcy Byrne and Councillor Mark Drury.  Due to the secrecy, it is not possible to know exactly what staff told Councillors but City Hub understands that Councillors believed that they should agree to the VPA because the proposal either had been approved or was about to be approved. Now seven weeks later, the rezoning has not yet been approved.

When did the Councillors first see the VPA and why wasn’t the community consulted during its development rather than before?.

The agreement provides for the developers to give at least $1 million to an affordable housing fund and another $1 million towards public infrastructure. $1 million will barely buy one new two-bedroom apartment in Inner Sydney.  It provides that a pocket park, public space in the middle of the development and an artist’s studio would also be handed over to Council. There is no mention of a community neighbourhood centre and IWC told City Hub that it had not heard of any such centre.

Given that the VPA assists the case for rezoning, it does not seem to provide adequate public benefit when considered against the serious detriment and risks to the public. The VPA also makes it more difficult for the Council to reject the development application.

The majority of Councillors voted to support the VPA in principle but to discuss it again after allowing 28 days for public comment. Only Greens Rochelle Porteous voted against the VPA.

For this reason, residents including Janet Dandy-Ward said that the “offer that seems to be being made in the VPA is clearly not enough, even if is a sweetener to the community for this overdevelopment in St Peters. “ She is concerned that, because it is voluntary, what benefits it does offer “may never be seen.” After feedback closes on June 18th, Council will again discuss the VPA.

IWC told City Hub last week that DPIE rang a Council officer at the beginning of June and told them the rezoning proposal would be approved by June 27th. So why does the Council website wrongly inform residents that the rezoning ‘was assessed’ while the DPIE told City Hub and residents that it was still being assessed?

No wonder residents are left with little faith in the planning process. “This whole process has been so confusing for locals, businesses and even local Cllr (IWC) to really understand. I think it’s really appalling that it seems to have indicated that this project was already approved when it was not. Many people in the local community have already objected to Precinct 75 at least twice, maybe three times; one local family have been aware of the toxicity of this site for about seven years! I felt completely confused by what it all means and it has taken me weeks to understand the processes,” says Janet Dandy-Ward.

Or to use the words of two planning lawyers, Suzy Cairney and Carla Mazibuko, from legal firm Holding Redlich: “Unavoidably, with a push to ‘fast track’ comes the risk that the processes designed to protect the community, environment, workers, etc. are eroded. So, despite the desire to get things moving, governments (and private owners) must ensure there is no compromise in the integrity of their processes in making decisions to fast-track or implementing fast-tracking measures.”

Like many small development stories, this one highlights more fundamental issues. These include the exclusion of the community from planning decisions, the failure of the NSW government to deal housing unaffordability in its response to COVID 19, and the lack of transparency of both NSW Planning and some local Councils. All of these issues affect the broader NSW public beyond St Peters.  We will report further on what happens.

Submissions can be sent to ED.EHC@planning.nsw.gov.au (closes 18th June 2020. Submissions or letters to the IWC and its Councillors about the VPA are also due on June 18th. 

Wendy Bacon is an investigative journalist and was previously the Professor of Journalism at UTS.

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