warehouse australia
Warehouses valued from $30M will now be assessed as State Significant Developments in NSW. Image – Canva.
  • Threshold for warehouses and data centres to be assessed as State Significant Development has been lowered
  • Threshold has decreased from $50M to $30M
  • Changes will be in place until May 2023

The New South Wales Government has announced a new accelerated pathway for planning approvals of data centres and warehouses.

Specifically, the NSW Government has lowered the threshold for them to be assessed as State Significant Developments (SSD) from $50 million to $30 million.

The new threshold will stay in place for two years, with Rob Stokes, the Minister for Planning and Public Spaces, remarking this will quicken the approval processes.

“During the pandemic, there has been a noticeable shift closer towards e-commerce, remote working and cloud storage which has led to an increase in data centres and warehouses. These are great for stimulating the economy – they’re simple to build, simple to assess and create a high number of direct and indirect jobs.

“Data centres and warehouses represent a $4.9 billion pipeline of projects so by lowering the threshold to assess more of them as State Significant Development, we are pushing them through the planning system more quickly.”

Rob Stokes, Minister for Planning

To help manage the demand, Mr Stokes added that there would be an increase in the number of planning assessment officers. Additionally, he announced that smaller data centres, subject to strict conditions, could now be set up as complying developments.

“This means we’re making it easier to build small-scale data centres without lengthy planning approvals while providing a swifter pathway for large scale ones.”

The new thresholds will be in effect until 31 May 2023.

Property Councils’s seal of approval

Jane Fitzgerald, NSW Executive Director of the Property Council (PCA), welcomes the announcement, citing the warehouse and logistics as the “backbone” of the NSW economy.

“This decision means the State will take an expanded role in approving developments which enable our supply chains to function more efficiently and effectively in a time of economic disruption and upheaval.” 

Jane Fitzgerald, NSW Executive Director, Property Council

Ms Fitzgerald added that when new warehousing applications enter the planning system, these are often backed by large industrial tenants who immediately need the extra space to cater for growing demand. Subsequently, approvals need to be fast and effective to begin construction.

A recent ANZ/Property Council survey shows that sentiment across the NSW industrial sector has hit record levels, highlighting the importance of a faster approval process, according to Ms Fitzgerald.

“Industrial and logistics property is a hot commodity right now and it’s great to see the NSW Government striking while the iron is hot,” said Ms Fitzgerald.

“It is pleasing to see the NSW Government has committed to expanding the number of assessment staff to support their decision to take on this new responsibility. We look forward to continuing to work with the Department as they continue to roll out their Planning Reform Action Plan over the coming months.”

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