Melbourne's residential pipeline could add 76,000 new dwellings to the CBD, Docklands and Southbank within five years, according to a new research paper.
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Real estate firm JLL's report Melbourne's changing skyline, released last month, analysed land supply in the inner city to create a three-dimensional model of what the cityscape could look like in the next five to 10 years.
The report's authors found there were 274 proposed developments in the residential pipeline in December, including projects with planning approval and those seeking approval.
But JLL strategic research director Annabel McFarlane said it was unlikely they would all reach completion by 2022. She anticipated many would be "pushed along into subsequent years" while others could hit planning approval snags. Tougher regulatory and lending criteria would also likely mean fewer developments hit the required presales for finance.
In 2017, an estimated 7800 new dwellings were expected to be completed, with the report concluding this was "close to the residential supply peak" in the CBD.
"Going forward, we recommend that over the next five years we might average 4200 dwellings per year, which is still strong but nothing like as big as we have had [last] year," Ms McFarlane said.
The report said Melbourne's tertiary education sector had a direct impact on population growth in the CBD, with eight student accommodation projects (with a total of 4530 beds) also in the pipeline.
There have been warnings about a possible oversupply in Melbourne's high-rise apartment market, amid a clampdown on investor lending. But Victoria's strong population growth seems to have partly alleviated such concerns.
Last April, BIS Oxford Economics said more than half the apartments bought off the plan since 2011 in the CBD, Docklands and Southbank had resold at a loss, or broke even.
The authors of the JLL research paper assessed every site in the CBD (including Docklands and Southbank) with the aim of identifying how much land could potentially be developed into office space.
It found commercial land supply was becoming constrained in the CBD, and Docklands was "close to being built out".
"We've got a lot of office development to build in the next four or five years but there's not going to be much scope beyond that," Ms McFarlane said.
She said residential development was not necessarily muscling out potential office projects, because office buildings typically needed larger sites than apartment blocks.
"But what it does do is stop the potential for the future amalgamation of sites going forward," she said.
The report found some pockets of the city was emerging as predominately residential. They included the north-west corner of the Flagstaff precinct, the southern side of Southbank and the northern part of the CBD.
