An existing use is a use of the land that is lawfully commenced but has subsequently becomes a prohibited use under new local environmental plans.  This has particular relevance to the South Sydney area as it has seen significant transition between industrial and residential or commercial uses.

“Amendments were originally made by the NSW Department of Planning to the existing use provisions on 29 March 2006, making it no longer possible to change from one prohibited use to another prohibited use without re-zoning,” says Mr Kalpidis. 

Since these changes were introduced, the 2006 legislation has had a detrimental effect on a number of owners of industrial properties in the South Sydney area. “Up to a dozen sites that were listed for sale or lease during the period have been affected, particularly in the Mascot station precinct,” he says.

“There have been examples over these past months where properties could only be leased to a user conducting the same business as the previous occupier, for example a wholesale canvass business or a car wash, which made leasing or selling these particular properties extremely challenging due to the limited market.”

In one particular local example, Mr Kalpidis cites a South Sydney industrial estate with a vacancy of approximately 25% which could only be leased to a tenant of the same specific industry, yet the majority of the estate had already been leased for another 8 – 10 years to other industrial uses.

However, Mr Kalpidis says that more recent amendments to the legislation have been adopted in February this year that may help to alleviate the issues somewhat.

“The key point in the recent amendments is an existing commercial or light industrial use can be replaced by another, non-conforming commercial or light industrial use,” he says. “With these recent amendments, interest and activity in the South Sydney industrial estate has increased significantly.”

 “This is a key change to the legislation and may help to alleviate some pressure on owners and have allowed them some scope to lease or sell their properties.”

“This change is essential to maintain the viability of industrial investment properties in these transitional zones,” says Mr Kalpidis.

However, at this stage, the changes are only in reference to light industrial, but does not specify manufacturing and continuing heavy industrial uses. “Whilst these are not issues faced so much in the South Sydney area due to the underlying value of the land, it may have more significance in Sydney’s outer western suburbs,” says Mr Kalpidis