Adelaide's Heart Transplant, 1970–88: 3. The Deployment of Capital in the Renovation and Redevelopment Submarkets

Abstract

In this, the last of three papers devoted to urban restructuring and its impact upon the built environment of an Australian city, the spatial focus narrows from the metropolitan region to an inner zone of Adelaide. This is the part of Adelaide that has gained most from the processes of residential reinvestment and gentrification over the last two decades. The interest in the circulation of capital that has been maintained throughout the previous papers is explored more fully by measuring and evaluating investment activity in the renovation and redevelopment submarkets. The evidence presented on the organizational structure, levels of investment, and returns to investment within the two submarkets makes for a better-informed characterization of ‘property capital’. It also serves to make the accompanying role of public finance in the revitalization process much clearer. In this paper, the interpretation of capital formation in the renovation and redevelopment submarkets suggests that all three tiers of government in Australia have been thoroughly implicated in the residential transformation of Inner Adelaide during the last two decades. Changes to the Commonwealth States Housing Agreement in 1973 released public funds for rehabilitating terrace housing in the City and inner suburbs, and the Hawke Government restructured taxation policy and the financial markets affecting investment in the home unit and town house submarket in the 1980s. Meanwhile the Dunstan administration in South Australia axed the freeway and high-rise-housing plans of the previous state government, and pressured City Hall to abandon its grandiose plans for commercializing the City's ‘square mile’. The residential development policies conceived in the mid-1970s as part of the replacement City of Adelaide Plan were emulated by other local government bodies in the nearby suburbs. Somewhat uncharacteristically, the state's public-housing agency gave a lead to project developers in the private sector by demonstrating what could be achieved in the submarket of inner-city-home units and town houses.