UPDATED: Many a beautiful old building has been lost to money-grabbing developers but what happens when heritage stands in the way of sustainable, community-oriented needs-based housing in the inner city? That’s where things get complicated.

In Sydney’s progressive inner west suburb of Marrickville, a church group called Fresh Hope (a registered Community Housing Provider) has teamed up with Nightingale Housing – the development crew that is shaking up housing in Victoria with its triple bottom line approach to sustainable housing – to demolish a disused church for affordable, carbon neutral, rental housing.

The plan was to demolish an ageing church that had sat unused for seven years and adjacent house on the Churches of Christ’s property to build specialist affordable housing operated through a long term build-to-rent model.

In Melbourne and now parts of regional Victoria, and even Adelaide, the Nightingale model has set the bar high for sustainable residential development, building ecologically sensitive homes that encourage incidental social interaction via shared spaces such as rooftops and laundries.

These developments generally don’t have parking but instead are always thoughtfully situated close to key services and public transport to decrease reliance on carbon intensive private vehicles, with spots for bikes and maybe a carshare.

Perhaps most critical is Nightingale’s approach to affordability through an innovative financial model that caps profits at 15 per cent to keep apartment prices down and includes a percentage of affordable housing.

But for the company’s first foray into Sydney, the model was going to look a little different.

The costs of development in Sydney are so much higher than in Melbourne that Nightingale opted for long term build-to-rent in accordance with the affordable rental housing guidelines.

The final development application included a $9.5 million six-storey mixed-use building with 55 boarding rooms, with the rent for the dwellings are expected to be around 30 per cent below market rent for the area.

What the church really wanted from Nightingale, Fresh Hope’s direct group operations Dan Dwyer explains, was its intentional approach to tenant cultivation. This included a mixed demographic of tenants so that the local community was well represented in the building, and not allowing investors to purchase into the building (not applicable in this instance, but you get the idea).

Dwyer says affordable long-term rental housing is a pressing and immediate need in the community and that Nightingale could help provide it.

“State and federal governments and agencies have been working to develop a model that makes the product attractive for developers – and have not yet landed that model.

“Fresh Hope believes that what Nightingale Housing offer works for not-for-profit community housing providers such as ourselves.”

Similarly, Fresh Hope was the only way Nightingale could expand to Sydney given the price of land.

Nightingale’s founder architect Jeremy McLeod of Breathe Architecture says: “A major barrier to entry into the New South Wales market for Nightingale is the price of land.

“In Victoria, land price accounts for approximately one third of our project costs. In New South Wales it’s double … Fresh Hope have contributed the land to the project at a $0 cost.”

According to Dwyer, the church actually has five or more sites scattered around the city slated for this type of development but decided to target the Marrickville location first to prove the concept worked.

Marrickville was selected initially because the Inner West Council were seemingly favourable to the Nightingale Model, with the model cited in the Inner West Council draft housing strategy in reference to affordable housing in Marrickville.

The site was also a good spot for the low carbon housing model.

“The site proposed by Fresh Hope is ideal,” McLeod says.

“It’s 150 metres from Marrickville train station, which is of the utmost importance for a Nightingale project – as part of making housing affordable is access to reliable public transport. The Marrickville location is well supported by interconnected cycle ways and pathways.”

While Dwyer says the early interactions with the council were positive, since lodging the development approval last year the council has rejected the project on the basis of heritage and lack of onsite parking.

The matter has since been taken to the Land and Environment Court where the battle over the project continues.

Heritage? Since when?

Dwyer was shocked he said because the team asked about heritage issues in the early planning stages but were advised it would not be a problem.

According to Marrickville Heritage Society president Scott MacArthur, the church was initially identified for local heritage listing five years ago but upon protests from its owners (Fresh Hope), the recommendation to assess the building was rejected by the then-administrator for the Inner West Council.

Its heritage value has since been revisited, with council authorising an interim heritage order in January. After a public exhibition last week, the proposal to make the heritage listing permanent was waiting on a vote by councillors.

MacArthur told The Fifth Estate that the developer’s own heritage report stated that the Queen Anne style house was worthy of heritage listing, and they were “very aware of the council’s thwarted intentions to list the church, as they convinced the administrator to over-rule council staff”.

According to local Greens councillor Colin Hesse, the heritage assessment wasn’t brought forward out of malice – it was always on the cards but had not happened due to the council amalgamations that saw Marrickville Council absorbed by the Inner West Council. 

As far as the councillor is concerned, it’s hard to see why a building of heritage significance should be sacrificed because of big picture failings in the social housing system.

He says that the chronic housing affordability issues stem from insufficient social housing supply, which represent a failure on state and federal governments – the only institutions in a position to supply it.

“The idea that we should look for a market solution to the housing problem is misleading, it might be a solution for a small number of people, but ultimately, the market is not going to resolve housing affordability issues.”

He says abolishing regulatory barriers such as negative gearing is the way to alleviate the housing supply issue at scale.  

“If we got rid of negative gearing, then we wouldn’t have a housing problem and an affordability problem. You can’t just ditch heritage because of failures elsewhere in the system, councils have nothing to do with that.”

Another argument against the development is that Marrickville is well-serviced in terms of low cost housing. According to a statement from Scott MacArthur, president of the Marrickville Heritage Society, Marrickville is second only to the City of Sydney as a low cost housing provider, with the locality home to double the number of boarding houses as Randwick, which is the third largest site for low income housing of this variety. 

There’s indeed been a huge amount of higher density development along Illawarra Road through to the Warren Road since the area around the train station was rezoned around ten years ago. Hesse warns that the area is in danger of losing its local character and beauty if a project like this is allowed to go ahead.

“If all the Illawarra road is an unbroken road of high rise apartments, is that really okay?”

When it comes to heritage, Hesse says there’s always the argument that there’s “plenty more heritage buildings” left but “once you start knocking them off, pretty soon there’s none left.” 

Both MacArthur and Hesse (who is also in the local heritage group) would prefer the development be adapted for reuse, which its local heritage status would allow. Both would like to see the site used for low income housing, as long as it’s done without demolishing the church and the house next door.

Church says adaptive reuse is not really an option

According to Fresh Hope’s Dan Dwyer, adaptive reuse options were considered but the site is not ideal because the church is on an angle.

The developers reportedly looked at other alternatives, such as moving the church entirely (which has been done elsewhere) but this was considered too expensive.

Ultimately, the developers are unable to budge on the heritage requirements to go ahead with a feasible project. Dwyer says the team have gone to great lengths to meet the council’s ideals, such as promising to recycle bricks from the church in the new building and parts of the roof.

Admittedly, the timing of the heritage listing is suspicious. ShelterNSW CEO John Engeler suggested that if heritage assessments are only triggered when a development approval comes through, the heritage system is likely in need of reform. 

Heritage doesn’t seem to be the only problem

Dwyer says that the council also struggled to come to grips with the use of common areas such as rooftops gardens and laundries, which are a hallmark of Nightingale’s developments that help to spark spontaneous interactions between residents to create a sense of community.

The no parking was also deemed an issue by council, despite its proximity to the train station and its potential to curb carbon emissions. The developers offered to pay for GoGet memberships for all residents and other alternatives but ultimately, onsite parking is a non-negotiable under the Nightingale model.

What Dwyer really thinks is going on is a deep-seated suspicion about developers – which is completely understandable – and the failure to recognise the benefits of this novel development type.

In Sydney, a very legitimate suspicion of money-hungry developers remains.

But as Dwyer points out, Nightingale Housing has a stellar track record as a sustainable housing provider and the church is a registered community housing provider (not-for-profit organisations that build and/or manage housing for very low, low and moderate income households) that has existed as an organisation in this space for over 140 years.

He also points out that the build-to-rent model also doesn’t lend itself to quick profits.

“I think that’s part of the misunderstanding. If it’s build-to-rent, it’s not a developer trying to make money, because they are sticking around.”

The other fear is bound up in other boarding house developments that have seen developers go on to sell after restrictions on the title have lapsed. To counter this concern, the church was offering a 50 year title so that the housing would remain affordable for half a century rather than the customary 10 years.

ShelterNSW’s John Engeler, whose organisation is concerned with alleviating homelessness and housing affordability issues, agrees that there’s a lot of confusion.

“I think people in general think all developers are out to seek a profit, but in this instance, they want to own and retain.

“People get confused, there’s a lack of awareness and education about what’s affordable housing and social housing and how it’s different.”

Engeler says that something like this is targeted at people who need a little more community support and want to stay in the area. It’s not standard affordable housing meant for low income workers such as cleaners, aged care workers and other key workers but a different product that typically needs a third party to keep the tenancy on foot.

This type of specialist housing is suitable for people with an intellectual disability or experiencing some kind of impermanent instability that means they may not be able to front up rent each month.

This sort of housing allows people to have a level of independency with the security of knowing there’s support at hand, Engeler explains.

Dr Michael Fotheringham, executive director at AHURI, says that the council’s rejection of this project is hard to swallow given housing pressures are worse than ever due to Covid.

He says that inner city land on offer free of charge by the church for affordable housing is not an offer to be refusing in this climate.

“It’s hard to justify when people are having to travel hours to get to work because that’s the only place they can afford.”

He also says this is not about developer profit, but a church housing working with the “social enterprise version of a developer”.

“This is not about Lendlease getting rich.”

The council was contacted for comment with no response by the time of publication.

*A previous version of this story said the church was set back a third of the way into the plot although that is not that case.

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  1. This is so, so disheartening. Nightingale is one of the few globally renowned innovations in housing that Australia has produced. Contextual, transit-oriented and affordable – significant investment in social housing aside, it’s the thing we need most.

    A retrospective and dubious heritage listing being used to explicitly block it is tragic. The other sticking point being a lack of parking when that is the entire point, is baffling. This is within a council area that has declared a climate emergency. A council that called on the State Government to include a higher target for affordable housing than initially suggested.

    We need the Inner West Council to come to the table, and we seriously need some actual progressivism among those of us in inner Sydney who claim to be.

  2. I’m not a public figure or government representative, so I’m generally reluctant to comment in these forums. However I’m merely trying to add a perspective from someone who works in development – alongside many areas of government, not-for-profit, as well as with property developers. Yes – I have property developers as clients. And I’ve done work for Fresh Hope – but not on this Marrickville site unfortunately.

    My personal passion is for the creation of meaningful places which deliver both meaningful social and economic outcomes.

    I love heritage buildings which make up the visual and experiential fabric of cities. It’s gutting when I see cities in different parts of the world destroying their built form history. I’m glad we’re protecting true heritage buildings in Australia.

    However when I see an old building which seems to offer no clear value used as some kind or Trojan horse excuse to block progressive outcomes for community and residents, it’s incredibly frustrating for me – and for my friends who also raise the topic. People get fed up with retrospective restrictions, and it just forces the greater population to look at heritage with an unfortunately negative attitude. Especially for families in inner Sydney who don’t want to live like families did 100 years ago when their houses were built, as attempting to do a residential renovation or extension feels near impossible without engaging lawyers and added costs. OK, I’m going on a tangent here…

    While true heritage should be celebrated and protected, at face value this empty ex-church does not fit into that category. It certainly wouldn’t pass the pub test to be clarified as a meaningful heritage building.

    The Inner West Council should be supporting and congratulating Fresh Hope and Nightingale for this incredible development initiative. With the councils housing strategy to deliver more affordable housing in Marrickville, the council should see it as the gift that it is. Marrickville would be lucky to get such a benchmark development which could influence other Sydney locations.

    And in the Fifth Estate article, I don’t think Councillor Colin Hesse should have used the word “malice” in his statement, because that’s sure how it looks to many of us.

    Yes Councillor Hesse, the chronic housing affordability issues stem from insufficient social housing supply – but regardless of which government department you’d like to blame, isn’t it fantastic that either not-for-profits or private enterprises would like to do something towards fixing it?

    And your excuse or proposed solution is to abolish negative gearing? Totally disingenuous. It feels a little ridiculous for you to propose a national solution, to housing affordability problem – which in this instance your council has every ability to help contribute towards solving.

    As you state Councillor Hesse “the market is not going to resolve housing affordability issues” – which is correct when local government create roadblocks and increased costs like this which are a constant prohibitor for private enterprise to even attempt to contribute towards.

    If you talk to council about issues up-front, and then previous dialogue is ignored at the crucial point of approval, then what’s the point of having these conversations with council up front at all? It’s why the vast majority of developers (and local residents) just head straight to court. So it’s outcomes like these which cause courts to be backed-up for 6+ months, lawyers to stay rich, costs to go through the roof, prices to go up, and communities to eventually miss out.

    In all fairness, well done Councillor Hesse for contributing your time to such a worthy cause as volunteering to be a part of the local heritage group. However it doesn’t seam reasonable that you’re able to use your position as a Councillor to change the rules and block meaningful, community based progress. When it comes to government based decision making, you can’t wear two hats.

    We’d all like to see many sites used for low income housing, however the cost of Sydney property is sky high, so wouldn’t it be great if we could take advantage of the few opportunities we do have?

  3. An incisive article, exposing the inadequacies of Sydney versus Melbourne in this much needed, affordable CoLiving housing space.
    Having been lucky enough to have visited Nightingale’s Commons project in Brunswick, Melbourne last Christmas, I strongly recommend that appropriate members of the Council are given a tour there once the borders are re-opened, it should help broaden their horizons, in every sense.
    Regarding heritage status, perhaps the Church could be integrated as a communal space embedded within the development, while allowing for the same amount of flats in total by massaging the building massing?
    And on carparking, #MetaLoop would render that perceived need obsolete.
    And a traffic engineer’s mobility report would surely make the case even today, for the vastly reduced need for cars in inner-city 2020 Sydney?

  4. When some call for the heritage listing of eyesores like 105 Miller St North Sydney it is no wonder that heritage is also used as a means of frustrating useful urban regeneration projects such as this.

  5. Really good write up, very depressing to hear about councils pushing back against this kind of badly needed innovative and beneficial development (by Australian standards). I find the insistence of parking requirements particularly frustrating.