Inside the new Victorian Planning Zones reforms: Urbis


The Victorian Minister for Planning announced last week the implementation of the highly anticipated Commercial Zone reforms. The details of the new Commercial Zones have been released, and will come into effect in all planning scheme across Victoria on 1st July 2013.

The new zones are broadly consistent with the draft zones that were released for public comment last year, with only minimal changes between the final and draft versions. Implementation of the new zones will see greater flexibility for commercial and retail development across a wider range of metropolitan and regional locations, including opportunities for small supermarkets (up to 1800m2) to locate ‘as of right’ in a wider range of commercial and industrial locations.

Please click here for a PDF copy of the Zoning Reforms.

The Ministerial Advisory Committee appointed to consider the new zones has broadly supported the Government’s approach. While the majority of the Committee’s recommendations have been adopted in the final zone package, several recommendations were not pursued, notably:-

  • The proposed introduction of a new Commercial 3 Zone to provide for bulky goods retailing;
  • The introduction of a requirement for a Net Community Benefit Assessment to be provided to support applications for new retail floor space in Commercial 1 Zones; and
  • A maximum floor space of 1,500m2 for as of right supermarkets in the Commercial 2 Zone.


Headline summary of proposed reforms


1.     Changes to Floor Space caps

  • Floor area caps across metropolitan Melbourne removed in all Commercial zones;
  • Floor area caps in Metropolitan Melbourne that sit in schedules to other planning zones and overlays (for example, the Comprehensive Development Zone) will be removed by December 2013;
  • Floor space caps will be retained in metropolitan Growth Areas for new suburbs that are in included in an Urban Growth Zone (ie: where the commercial hierarchy is establishing rather than mature);
  • Councils in regional and interface areas around metropolitan Melbourne will retain the ability to schedule in floor space caps for shop and office uses.

2.     Commercial 1 Zone

  • Removes permit requirements for all retail uses (except for adult bookshop);
  • Removes permit requirements for accommodation uses (subject to satisfying a 2 metre frontage condition);
  • Is otherwise similar to the existing Business 1 Zone in its purpose and provisions.

3.     Commercial 2 Zone

  • Allows a range of retailing uses as of right, including:
    • Allows a permit to be obtained for supermarkets greater than 1,800m2 for land within the Urban Growth Boundary where accessible via a Road Zone.
    • Office, Warehouse and Industry are as-of right uses, whilst accommodation is prohibited.

    4.     Industrial zones

    • Removes the 500m2 default floor space area restriction for office, but allows Councils to specify a floor area cap for office uses in the schedule.
    • Within the Industrial 3 Zone; allows as of right:-

    5.     Proposed Policy Changes

  • The Ministerial Advisory Committee has recommended minor changes to the State Planning Policy Framework to support the implementation of the new zones. In particular, the Committee has recommended changes to Clause 17.01-2 in relation to  ‘Out of Centre’ development as follows:-

  • “Ensure that out-of-centre proposals are only considered where the proposed use or development is of net benefit to the community in the region served by the proposal or provides small scale shopping opportunities that meet the needs of local residents and workers in convenient locations”. (new addition in bold)

    The State Government has not yet announced whether there will be changes made to the SPPF as part of the VC Amendment on 1st

     July 201

    6.     Key impacts of the reformed Commercial Zones include:

    • Increased flexibility for supermarket uses to locate in a much broader range of locations;
    • Flexibility for large offices to locate outside activity centres in industrial/business precincts;
    • Potential reduction in the need for permit approvals and the complexity of permit applications;
    • Potential enlargement of activity centre boundaries, with peripheral land previously zoned Business 2 or 5 now enjoying the same zone entitlements as the core Business 1 areas;
    • Significantly enhanced flexibility for Business 2 and 5 land (new Commercial 1 Zone), given as-of-right shop allowances and abolition of floor space caps;
    • Significantly enhanced flexibility for Business 3 and 4 zoned land (new Commercial 2 Zone) which now allow shop uses subject to a permit, and small supermarkets as of right;
    • Removal of caps in shopping centres across the metropolitan area and in growth area locations not included in a UGZ.


    This article first appeared in the Urbis Think Tank. Urbis is an interdisciplinary consulting firm offering services in planning, design, property, social planning, economics and research. Working with clients on integrated or standalone assignments, Urbis provides the social research, analysis and advice upon which major social, commercial and environmental decisions are made. With over 300 staff Urbis is uniquely positioned to handle projects from the simplest to the most complex.

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