And how we address them

Meeting industry challenges

Our response to the shortage of development finance resulting from the global financial crisis was to ramp up investment in our own developments to ensure continued supply of land and new housing. We have not yet seen a complete recovery in the industry and expect continued funding constraints in the coming year. This means we will have to be selective about where we allocate investment in new and existing projects.

Responding to moderate income housing needs

Despite exceeding our moderate income housing targets this year – and doing so by a considerable margin – provision of affordable housing remains an ongoing challenge. Our good results, in part, reflect the volume of housing product we released in the Hunter (where land costs are generally lower) and historically low interest rates, which meant housing has been more affordable for moderate income earners. Now that we are emerging from this low-interest environment, we will face renewed pressure to perform in this area. As in the past, our response will be to continue to promote housing diversity in our projects so we are able to offer a variety of differently priced products.

Promoting urban renewal

The Metropolitan Strategy for Sydney calls for 60-70% of all new housing built over the next 25 years to come from urban renewal. In recent years, the number of authorities involved in the urban renewal process has grown, reflecting the growing complexity of this process. At the same time, confusion over the issues among the general community has increased, and opposition to the renewal process continues in some quarters. Our approach to urban renewal is both simple and practical. We seek to demonstrate by example, persuade through negotiation and then validate results through productive partnerships with the development industry. Our message is that higher density housing need not mean poor development. We are working in close partnership with the Department of Planning and others to encourage greater coordination across agencies. We also remain actively engaged in the wider task of informing and educating key players in this process. For example, in the coming year we will finalise our Housing Diversity Guide and release a draft Density Guide for public comment. We also plan to identify a demonstration project to showcase practical approaches to diversity and density.

Water sustainability - Victoria Park	Local construction activity - Oran Park	Successful urban renewal - Victoria Park

Reinforcing a sustainability culture

Landcom has been reporting its performance against our comprehensive system of sustainability indicators since 2002. This year marks the introduction of our second generation of indicators, many  of which include increased targets and more complex reporting. Because new staff have joined us in  the eight years since the introduction of these indicators, many of our employees do not have an  in-depth understanding of how our indicators evolved or fully comprehend their value. As well, some  longer-term employees may have lost sight of why certain steps are taken and how a chain of  individual responsibility ultimately adds up to reflect corporate performance. This was the subject of focus-group discussions during the year and we have identified several challenges, including the need  for ongoing reinforcement of a sustainability culture across Landcom. Over the next 12 months, we  will develop and implement measures to further educate staff and reinforce a culture of quality and  accuracy in our sustainability reporting.