Craig Holden, director of property development firm Forme Projex and chair of the State Planning Commission, spoke to the council on Tuesday night about consultation on next year’s Greater Adelaide Regional Plan (GARP).

The plan, which will represent an overarching strategic vision for Greater Adelaide’s land use, infrastructure, transport and public realm, outlines a need to identify space for another 100,000 homes by 2051.

Holden told councillors there was an urgent need for more rental housing and one bedroom apartments in the city tailored to young workers, and urged the council to support community housing providers who are legislated to provide rental housing below market rates.

He highlighted the CBD’s low rental vacancy rate – recorded at 1.1 per cent in July by SQM research – and said that 60-square metre, one bedroom apartments he builds as a developer “go in seconds”.

“We have no problem in renting in the city to young people – they love it,” Holden said.

“So the diversity is there, but you need the housing diversity.

“They can’t afford to rent a two bedroom with a car at $600 a week, but they can afford a well-designed, well-conceived one bedroom at around $375 to $400 a week.”

Around 99 per cent of new homes constructed in the City of Adelaide over the last 30 years have been high or medium density apartments, according to council data.

But Holden cautioned that building costs in the city have now become a “serious problem” inhibiting apartment development and making the suburbs more attractive for developers.

“Because of building costs, you’re now driven to only providing for the wealthy,” he said.

“A three bedroom apartment, you can’t deliver it for under about $1.1m, $1.2m. A two bedroom, two bath home – you can’t deliver it for under $800,000.”

Holden said the trend meant it was difficult for the CBD to compete with the suburbs to attract builders and families.

“Builders would rather go to the suburbs and build two-storey townhouses than the challenges that apartments in the city present,” he said.

“It does cost more to build in the cities, more than anywhere.

“When you do road closures and the like, I could spend $100,000 just on council rates, charges and taxes just to close a road. If I go down and build at Port Adelaide, it’s a $37 fee.”

State Planning Commission chair Craig Holden and Planning Minister Nick Champion. Photo: Tony Lewis/InDaily

The Planning Commission’s consultation on the GARP comes as Adelaide City Council works on two other documents – the City Plan and the Strategic Plan (2024-2028) – which will inform the future development of the CBD and North Adelaide.

Councillors were presented with a draft strategic plan on Tuesday which targets increasing the number of people living in the City of Adelaide from 26,000 to 50,000 by 2036.

It also targets increasing the proportion of family households in the city from 12.5 per cent to 15 per cent.

Holden cautioned councillors that it is “unlikely you’re going to get Mum, Dad and the three kids moving into a house in the city” due to higher housing costs.

“It’s very difficult to build a three bedroom family home, single-storey in the city to compete with somewhere 10kms from here – you’re talking twice the price,” he said.

“The old adage is you drive till you can afford it.

“You can go out and get your three bedroom, two car garage, two living areas, three bathrooms out at Dublin from Michael Hickinbotham and you can get one of those for about $545k.

“But $545k won’t buy you much in the City of Adelaide… neither will it buy you anything in the inner suburbs.”

According to the 2021 census, couples with children made up just eight per cent of City of Adelaide households, and one parent families made up just 4.5 per cent.

That’s much lower than the proportion across Greater Adelaide, which is 28.6 per cent couples with children and 11.3 per cent one parent families.

Central ward councillor David Elliott questioned whether the family household targets of council’s draft strategic plan and the Planning Commission’s GARP were unaligned.

“We’re trying to attract more families into the city to boost that diversity of households and try and bring people to engage in the rich offering we do have in the city,” he said.

“But that doesn’t seem to be supported by the GARP as it currently stands.”

Holden replied that the planning system “can only provide planning choices and options” and the market will determine based on dollars “what happens where”.

“Unquestionably you want more families in the city. In all the buildings that I’ve built, and all the three-bedroom apartments, there’s only one family that’s got a child,” he said.

“There’s plenty of three bedrooms that are eminently suitable, but when you’re in your 30s and 40s and 50s, that’s when you’ve got your suburban home, that’s when you aspire to your backyard.”

Holden later said: “If you look at who we’re trying to accommodate, you’ve got wealthy people who buy expensive apartments, you’ve got students who’ll live in well-designed student accommodation, you’ve got empty nesters who can sell their home in Linden Park and buy something for a million dollars in Adelaide… then you’ve got half the city’s rental accommodation anyway.

“So, what we really need is rental accommodation for key workers and young people and for those who are never going to be able to afford to buy anything – and sadly, that’s a growing cohort.”

Council is yet to adopt its strategic plan, with councillors deferring consideration of it on Tuesday night due to concerns about other aspects, including rates revenue and property selloffs.