Saturday 31 October 2015

Diversities of density

As we descended into Osaka airport, the landscape surprised me. It was like Simcity with the treed mountains as a backdrop, and virtually every square inch of flat land developed, some at very high density with 15 (or greater) story buildings. With the bullet trains, Japan seemed more like a continuous city than a number of separate cities. Farms are small (under 1ac), are farmed more intensively than in Australia.

In cities around Sendai, the historical development was small villages or clusters, with farmland around and dispersed. The mix of farmland and houses appears to be in part due to the historical pattern of numerous smaller farms, and the lack of a planning system to rezone areas of land for residential development.

The topography has prevented much ‘sprawl’ (although in some cases this has been overcome by the removal of mountains), and in cities such as Osaka, Kyoto, and Sendai there was a real mix of densities with high rise being surrounded by two to three level single dwellings. I’m haven’t been able to find out why a more consistent approach to density has not been achieved. Perhaps it’s due to an inability to acquire and consolidate land.
Land uses are also far more inter-mixed in Japan, with farming, some industrial, commercial and residential development all occurring in close proximity. Australia’s zoning regulations separate land uses out more, preventing friction between them.

In Tokyo we met with local developer Kit Weddle (a property developer in Tokyo), where we learnt about plot and floorspace ratios. Over time the government has increased the level of building floorspace that can be achieved for each square meter of land. To some degree this builds in a planned obsolescence. As rental returns reduce for older buildings, and maintenance costs increase a building reaches a point where it becomes economically viable to demolish the building, and construct a brand new building with greater floorspace (and meeting more stringent current earthquake regulations) therefore returning a far greater rental return.

This varies from Planning in Melbourne where our planning system has a different mix of performance and prescriptive measures, and floorspace or plot ratios are not set, rather requirements for sunlight and (in some instances) height limits apply.
Unlike in Australia heritage is no impediment to new development as it isn’t really valued in Japan (other than from a visual perspective, where replacement buildings may look like older buildings at lower floors). Kit advised that it would be extremely unusual for government to control private property rights through means such as a heritage overlay. Heritage Overlays are applied widely in Victoria, and result in significant justification being required to demolish affected buildings.

Low interest rates (currently around zero) also help promote new construction and therefore demolition of older buildings. However much of the development (and new floorspace created) does not appear to be due to expanding commerce, rather just an economic decision to replace for greater return. However for the significant investment in replacement, it does not appear that this is due to a growing economy or to satisfy unmet demand, rather this development is very speculative, just because the current rental return will be greater. In Australia, there has been far less speculative investment, due to alternate (less developed) lower value sites being available, and our higher interest rates by global standards.
Many of the sites we visited were previously owned or controlled by public authorities. While they have been sold, many of the public authorities still hold restrictions on title which in many ways restricts new development. He explained this as an extremely bureaucratic Japanese process. In Australia, covenants or caveats would be registered on title, and would dictate less control (other than the specific reason they were applied) over future development.

In the Tsunami recovery areas, initially little community consultation was done, however as the community were unhappy with proposed outcomes, increased community consultation was undertaken. This is much like in Australia where there has been a shift to undertaking more community consultation to ensure that the end users will be happy with the outcomes.

Daniel Borton

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