The Sirius building. Image: Martin Pueschel

Apparently, what some have called the “social cleansing” of Millers Point is not a done deal.

A recent decision by the Land and Environment Court seems to kibosh the sale of the Sirius building – for the moment at least. The court found that the minister responsible for refusing heritage listing paid undue regard to a likely lower sale price if the building were listed.

Responding to the court’s decision, minister for family and community services Pru Goward observed: “The decision by this government to sell the public housing assets in Millers Point, Dawes Point and The Rocks was made after careful consideration of how to deliver the highest possible benefit to the community, particularly those in need of social housing.”

This comment summarises the original idea, which was to sell high-value government-owned inner-city social housing, encumbered by long-deferred maintenance liabilities, and procure new housing elsewhere in the Sydney basin for a greater number of social housing tenants.

However, many deplored this formula as reductive and cynical, tantamount to social cleansing of valuable inner-city property. It rather too neatly combined social concern with fiscal rectitude, set any dissenting Millers Point residents against the larger number on social housing waiting lists, and bypassed fuzzy complaints of heartless government by implying that existing residents were unworthy harbour-front slackers.

Additionally, many feared the template would be repurposed to sell many more increasingly valuable inner-city social housing sales, such as at Waterloo, Glebe and Woolloomooloo.

The problem now confronting government is that its reasoning has been exposed as failing to address the complexities of adopted urban policy.

Financial expediency not appreciated by the court

The court’s decision specifically challenged a fundamental assumption that urban policy – in this instance heritage listing – was to be founded on financial expediency.

Recalling the Wildean distinction between price and value*, the court’s decision specifically challenged a fundamental assumption that urban policy – in this instance heritage listing – was to be founded on financial expediency:

“The financial impost associated with such iconic heritage items (as the Sydney Harbour Bridge) might be enormous, never cease, and cause the owner to suffer financial hardship – but however onerous, any financial hardship would, arguably, never be considered to be ‘undue’”.

How might this particular insight have played out more broadly, prior to the Millers Point announcement? Are there other policy goals of government and features of the precinct that could have delivered better outcomes?

Let’s turn first to other policy goals.

Social equity turning into a very big political issue

Social inequity, which includes housing unaffordability, is shaping up to be one of the biggest issues at the next national election.

It is now generally accepted that inequity harms cities.

High housing costs close to city centres are due to market forces that favour proximity to high-value jobs, such as those in Sydney’s CBD. Left unchecked, these forces squeeze out all but the wealthy.

Locational inequity bars access to jobs for many who are essential to a city’s functioning. More insidiously, inequity constrains participation in urban life, which generates social disruption that harms the economy. Once these trends are entrenched, governments are left to reverse the effects but struggle to do so.

Governments worldwide have adopted policies to increase the proportion of social and affordable housing in affected cities.

Policies in Sydney typically require developers to provide a fixed but small percentage of their output for affordable housing. Developers often oppose these measures despite benefitting from the market conditions that contribute to the problem.

The clear implication is that any government determined to address housing affordability would seek to deploy all the tools it controls, including land that government owns.

Urban land embodies two features essential to solving locational inequity. The first of course is its exchange value, the subject of the Millers Point announcement. But perhaps the most important is an inherent quality of urban land – its location.

Homelessness is an extreme symptom of inequity and is an inexcusable yet depressingly more common feature of many cities, including wealthy ones like Sydney.

Unsurprisingly, links between the rise of inner-city homelessness and the decision to sell the Sirius building are now being pressed as policy issues for government.

This brings us to “features of the precinct”. How could more policy goals be satisfied in Millers Point?

The sale of some valuable Millers Point properties, particularly those encumbered with deferred maintenance costs, makes sense – but not for all of them.

Importantly, inner-city land is capable of addressing locational inequity directly. Disposal to fund the purchase of more remote land does not.

To illustrate, the image below, based on Google Maps, depicts small potential parcels within Millers Point and The Rocks that might have been suitable for more nuanced redevelopment.

“Lot A” would harvest back yards to increase the accommodation of Windmill Street properties that could be retained for social housing. Excellent examples of this kind of infill development can be found in Pyrmont and Woolloomooloo.

Why not sell all government land?

All government land should be considered for sale, not just that occupied for social housing.

“Lot B” on rail land is currently vacant. With excellent Sydney Harbour views and development at a scale similar to the Sirius building directly opposite, the value of this lot would be significant if sold for private redevelopment.

St Leonards station is an example of rail land redevelopment at a much larger scale.

Similarly, “Lot C”, currently occupied by the forecourt and low-rise part of the Sirius building, could also be sold for private redevelopment.

The remainder of the Sirius building could be retained for social/affordable housing with little overall diminution to its significance. Precedents for this type of development are sprinkled throughout The Rocks.

Returning to heritage significance, the Sydney Morning Herald reports that reasons to list the Sirius building include “its historical role as a response to the Green Bans of the 1960 and 1970s”, with the building constructed to house working-class families displaced by developments in the Rocks and Millers Point areas.

Even with heritage listing, land use matters. It is common for heritage buildings to be repurposed for other “compatible” uses.

For example, long after original congregations have vanished, significant churches have welcomed replacements – think of the Hagia Sofia in Istanbul and the Mezquita-Catedral in Cordoba, Spain.

Likewise, affordable housing would seem to be a natural “fit” for the Sirius building if it were eventually listed.

When contemplating the full breadth of urban policy, governments are expected to lead by example as well as by decree.

Governments could lead by example

If governments are unwilling to devote or retain some high-value inner-city land to improve housing affordability, how can private developers anywhere else in Sydney be expected to do the same, as the Greater Sydney Commission proposes with its 5-10 per cent housing affordability measures?

It was, after all, state government that led the very successful and largely private redevelopment of Pyrmont and Ultimo. The current government should emulate these examples; ideally they should exceed them.

Returning to the distinction between price and value, if we imagine government to be a bus in which we all travel, we expect the bus to be maintained and improved, not dismantled, sold for spare parts and replaced by pedal cars simply because we can get more for less cost.

* The full quote from “Lady Windemere’s fan” is actually more equivocal:

Cecil Graham: What is a cynic?

Lord Darlington: A man who knows the price of everything, and the value of nothing.

Cecil Graham: And a sentimentalist, my dear Darlington, is a man who sees an absurd value in everything and doesn’t know the market price of any single thing.

Mike Brown has worked in NSW local and state government in planning, urban design, and strategic roles for 15 years. He recently completed a Masters of Urban Policy and Strategy at the University of NSW.

2 replies on “Price versus value in Millers Point”

  1. It worries me that Lot A is created by harvesting backyards, this fails to acknowledge that equitable access to green space is a paramount issue for the city. Considering the impacts that bare and barren cities can have on health, wellbeing etc. Green space is at the heart of social equity!

  2. Great article, Mike Brown. You highlight critical concerns about the provision of affordable housing in our great city. Shifting people from inner city affordable housing is precisely what we should NOT be doing.

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