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Calls for more Sydney planning flexibility

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Office vacancies in Sydney jumped from 3.9 per cent in January 2020 to 8.6 per cent last January.
Camera IconOffice vacancies in Sydney jumped from 3.9 per cent in January 2020 to 8.6 per cent last January. Credit: AAP

A peak body for Australian property developers says it's time for greater planning flexibility in Sydney's CBD, saying the city will never return to its pre-COVID employment levels.

NSW chief economist Stephen Walters has told the Sydney Morning Herald it's likely city workers won't return to working five-days-a-week in the office, meaning demand for office space will diminish.

Planning laws will therefore need to change to maintain the city's vibrancy, including turning unused offices into residential apartments.

Property development industry group Urban Taskforce said on Tuesday it supported Mr Walters' remarks, arguing the CBD planning system needed flexibility for offices to be transformed into residences.

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It said zoning changes would be required for the Sydney CBD to expand what is permissible in the "B3" zoned commercial core.

"Stephen Walters' suggestion that a flexible mixed-use option is the key to the future is timely," Urban Taskforce chief executive Tom Forrest said in a statement.

"The (Greater Sydney Commission) also needs to heed the changes in employment habits following COVID-19, and focus policy on delivery of new homes as well as jobs.

"Increasingly homes will be used as workplaces. That means commercial centres and well located industrial areas should also accommodate apartments - particularly where those centres are close to public transport."

Office vacancies in Sydney jumped from 3.9 per cent in January 2020 to 8.6 per cent last January, according to the Property Council of Australia.

NSW's unemployment rate dipped to 5.4 per cent this month.

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