Employment Zones Reforms

NSW Department of Planning and Environment (DPE) has been carrying out a review and is reforming the employment-focused zones in LEPs.

The intention is to rationalize and create a more consistent approach to the existing zonings. It is a response to the NSW Productivity Commission’s recommendations to deliver planning reforms to support economic growth and productivity.

There has also been a general need for the zones to be updated to reflect and facilitate emerging business types, innovation and reducing common land use conflicts.

Starting in late April or May 2022, DPE is expected to digitally exhibit the proposed changes to each LEP and new zoning maps, along with an Explanation of Intended Effect for the Self Repealing SEPP.

Exhibition will be for a 6 week consultation period.

What is Changing?

  • The familiar split of land use zones will change significantly, with changes in permissible and prohibited uses in new zone categorisations.
  • The 12 current zones will be converted to 8 new zones.
  • The strategic intent of the proposed zones is also changing – which will be relevant to assessment of DAs and Re-zoning proposals.

Updated land use definitions will also come into play, for example expanding the definition of Shop Top Housing; plus new definitions created for Data Centres, Creative Industry and Local Distribution Premises.

Interpreting the New Land Use Zones
The new zones are not a direct conversion of the existing land use zones, but the existing and the new are compared in the summary table below.

What are the implications?
In general, the changes should provide greater flexibility, with increased mandated permissible uses in the new zones.

However, some lots currently within a relatively flexible zone could instead find themselves in a more constrained zone – and vice versa. Notably, (and despite the intent for a consistent approach) Councils will be able to tailor the uses permissible in the zones.

DPE is leading the mapping process, through an iterative process with Councils. It will give Councils the opportunity to enable or constrain a shift in land uses in areas to support strategic objectives, such as delivering ambitions set out in their LSPS.

There are many fine-grain changes to the Standard Instrument Land Use Table, especially with the new definitions, but some of the following stand out:

  • Residential in different specified forms is permissible in E1 and MU1. The extent to which this will facilitate the sectoral shift of residential becoming a component of emerging mixed-use centres will be a major point of interest.
  • MU1 may allow for active ground floor commercial uses that could physically extend and offer greater flexibility than the traditional retail and service core of centres.
  • Warehousing and distribution uses will be permissible in more zones (new zones E3, E4, E5).
  • Smaller scale local distribution premises (e.g. last-mile logistics) are permissible in many locations, including in the heart of centres (E1, E2, E3, E4, MU1).
  • Data centres will also be permissible in a wider range of locations (E3, E4, E5, MU1, W4).
  • Creative and high technology uses, plus ‘artisan’ food and drink production also enjoy good flexibility in where they can locate – including in mixed-use areas (E3, E4, MU1, W4).
  • Some specific uses will be limited to the E3 Productivity Support zone under the Standard Instrument. These uses include animal boarding and training establishments, wholesale supplies, vehicle body repair workshop, storage premises and recreation facilities (major). However, there is scope for each Council to permit these uses in additional zones
  • How third party advertising signage fits in to the new zones remains to be seen.

More Simplicity or More Complexity?
Time will tell, but overall, there will be several key implications of the proposed changes, including new opportunities for uses in previously prohibited locations.

Conversely, there may be new limitations imposed in some areas, depending on the approach taken within each individual Local Government Area in both converting to and tailoring the uses in new zones.

A close review will be needed of the new draft zoning maps and key changes for individual sites and properties as soon as they are exhibited. In addition, a careful check will be needed of Councils’ choices for permissibility of uses that are not mandated.

We have provided an initial snapshot here, but for more details and if specific advice is needed for your project or property, please contact Mecone. The above employment zones reform table is also available to download here.

Contacts: Paul Keywood, pkeywood@mecone.com.au, or Erin Crane, ecrane@mecone.com.au, at Mecone, or phone reception on 02 8667 8668



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