The Pulse | 22 October 2025

Red Tape, Green Energy and Grey Areas: the Colours of NSW Construction

In housing, government-led planning reforms including large-scale masterplans aim to accelerate supply and urban renewal.  

The industry reports that concurrent increases in regulatory requirements are causing a blow out in project timelines. This tension between policy ambition and operational reality continues to be a central theme, impacting everything from DA approvals to project costs. 

In major infrastructure, the restructuring of the Northern Beaches Hospital public-private partnership (PPP) has culminated in a $190 million government takeover effectively banning future hospital PPPs and signalling a significant change in state procurement strategy. 

Meanwhile, the renewable energy sector continues its expansion with major project approvals. However, policy uncertainty and contentious landholder compensation disputes present challenges to participants. Finally, a fundamental change to contract management is on the horizon with the introduction of Dispute Avoidance Boards in the updated AS 4000-2025 Australian Standard contract, reflecting a push towards proactive risk mitigation.

Planning and Housing Delivery Under Pressure

The NSW government continues in its pursuit of policies aimed to combat the state's housing shortfall [1], yet the industry is struggling to keep pace. 

While initiatives like the NSW Housing Pattern Book are reportedly starting to "bear results" in lifting building activity [20] and a new "targeted assessment development pathway" aims to speed up approvals [13], builders on the ground report a different reality. 

The average completion time for a house has blown out to over a year, with apartments taking nearly three, largely due to an increase in "red tape" and administrative burden rather than supply chain issues [25]. This procedural and administrative complexity is constraining delivery, with NSW completing fewer homes in the first year of the National Housing Accord than the year prior, tracking below its 377,000-home target [25].

Despite this, major masterplans are set to transform key precincts, with proposals to unlock 50,000 homes along Parramatta Road [10], deliver 4,000 homes and 27,000 jobs in Pyrmont and Ultimo [18] and concentrate 80% of Waverley Council's housing obligations in a high-density Bondi Junction [3]. 

However, developers continue to face challenges. In Mosman, proposals are meeting community opposition over heritage concerns [5]. Meanwhile, in Double Bay, proposals are pushing planning limits, often requiring recourse to the Land and Environment Court for approval [21]. 

This dynamic underscores the continued conflict between state-level housing targets and local-level planning controls, creating uncertainty and delays that are at odds with the government's goal of accelerated delivery.

The End of an Era for Hospital PPPs

A policy shift has occurred in NSW healthcare infrastructure following the collapse of the Northern Beaches Hospital public-private partnership. The NSW Government has reached a $190 million agreement to take full public control of the facility from its operator Healthscope, which is currently in receivership [14, 15, 17]. 

The move follows public scrutiny and an auditor-general's report that cited a critical "tension between healthcare and profits" and failures to address clinical safety risks [15, 17]. Government officials have labelled the original privatisation a "failed model" and "one of the worst decisions of any NSW government" [15, 17].

The long-term consequence of this saga is the enactment of legislation that bans future private-public hospital partnerships in NSW [15, 17]. This landmark decision effectively closes the door on the PPP model for delivering new acute care facilities in the state. 

For the construction and investment sectors, this represents a major change in the procurement landscape, removing a major pipeline for private consortia in the health sector. The government's intervention serves as a reminder of the political and financial risks inherent in long-term PPP contracts for essential public services. 

Renewable Energy Boom Faces Headwinds

The transition to renewable energy continues to present an opportunity for the NSW construction sector, with a pipeline of 44 GW of large-scale solar and wind projects and 16 GW of battery storage awaiting investment [9]. 

Major projects are steadily moving forward, with the state government granting planning approval for the $1.2 billion Richmond Valley Solar Farm, which includes a 3,148 MWh battery system [8, 27]. 

Further Octopus Australia has acquired the approved 100MW Coleambally battery project, a key asset for helping meet the state's 2GW energy storage target by 2030 [28]. These developments are part of a broader infrastructure push that includes over $20 billion in investment in Western Sydney, connecting the new Aerotropolis with major road and rail links [6].

However, this growth is not without challenge. Industry leaders have called for urgent policy reform to address instability in the energy market and provide the certainty needed to unlock investment in the project pipeline [9]. 

A more immediate risk is emerging at the project site level. In the Central-West Orana Renewable Energy Zone, disputes have arisen over land acquisition, with farmers claiming compensation from EnergyCo is insufficient and inequitably taxed by the Federal Government [24]. 

NSW ministers have acknowledged that current compensation legislation is "not fit for purpose" for the energy transition [24]. This conflict over land access and fair compensation poses a risk to project timelines and social license, creating hurdles for the delivery of transmission infrastructure.

A Proactive Shift in Dispute Resolution

Amidst market pressures, an important development in contractual practice is underway that could redefine how the industry manages conflict. The newly released AS 4000:2025 standard contract introduces Dispute Avoidance Boards (DABs) under Clause 42, signalling a move from after-the-fact resolution to proactive prevention [19]. 

This development comes as the Australian Constructors Association estimates that disputes cost the sector over $560 million annually in direct costs alone [19]. Unlike traditional methods that are engaged after a conflict has arisen, DABs are appointed at a project's inception to maintain open communication and address issues before they escalate into formal disputes [19].

This approach has precedence internationally, where disputes referred to similar boards are resolved without litigation [19]. Local examples like the Sydney Desalination Plant, which used a Dispute Resolution Board, finished on time and under budget without major disputes [19]. 

While some question the cost-effectiveness of DABs on projects under $30 million, proponents argue the real value lies in fostering a collaborative mindset and improving risk management from the outset [19]. For an industry facing tightening margins and increasing complexity, the formal integration of DABs into a key standard contract offers a powerful tool to preserve relationships and protect project outcomes.

Final Thoughts 

The NSW construction landscape continues to work at bridging the gap between strategic goals and operational reality. While government policies, major masterplans and large-scale solar farms signal a clear intent to boost housing and energy infrastructure, the industry's capacity is being constrained by regulatory tension and project-level disputes.

Success will depend on navigating this complex environment with greater agility. Professionals who can master the evolving planning system, adapt to new procurement realities and consider the option of risk management tools like Dispute Avoidance Boards will be best positioned to deliver sustainable and commercially responsible outcomes.

1. Mortgage Professional Australia | by Rod Bolivar (18 October 2025). Housing shortfall persists as reforms yet to deliver results. https://www.mpamag.com/au/news/general/housing-shortfall-persists-as-reforms-yet-to-deliver-results/553442
2. By Peter Andrea (17 October 2025). Council and industry target DA times. https://www.949powerfm.com.au/local-news/locals/council-and-industry-target-da-times/
3. Daily Telegraph - Wentworth Courier | by Thomas Sargeant (21 October 2025). 'High-density' Bondi Junction to take on majority of council’s homes under new master plan. https://www.dailytelegraph.com.au/newslocal/wentworth-courier/highdensity-bondi-junction-to-take-on-majority-of-councils-homes-under-new-master-plan/news-story/734718ddee9d4dc3350415b62e64a946?btr=7183277912d17e057c331a5b45933317
4. NT News | by Jake McCallum, James O'Doherty (17 October 2025). Western Sydney’s $1bn Metro cash at risk as Premier stalls extension plans. https://www.ntnews.com.au/news/nsw/western-sydneys-1bn-metro-cash-at-risk-as-premier-stalls-extension-plans/news-story/d9193b5b569adade3649dbc910bf67d9?btr=89b6b0b6b0f981e634eb413f6465b49d
5. Mosman Collective | by ANNA USHER (16 October 2025). “A crime against Mosmanity”: Residents launch petition to stop demolition of historic homes. https://mosmancollective.com/uncategorized/a-crime-against-mosmanity-residents-launch-petition-to-stop-demolition-of-historic-homes-mosmanity/
6. By Renata Gortan (16 October 2025). Widening the M7 and connecting the M12 to provide growth opportunities to western Sydney. https://www.dailytelegraph.com.au/partner-content/widening-the-m7-and-connecting-the-m12-to-provide-growth-opportunities-to-western-sydney/news-story/532b18727baf92f747360b8fddfcb8e5?btr=749db1e49fd0d200a133dad096a3cf0d
7. The Australian | by Lisa Allen. (Date not specified). New $60m luxury Mosman project revealed near Balmoral Beach. https://www.theaustralian.com.au/business/property/justin-browns-abadeen-to-smash-mosman-price-records/news-story/850409dea746c445ed540e6fd5ccbe0b?btr=f33597df775f7eb3855d44a51ed02f78
8. IndyNR. (Date not specified). Solar farm to power 175,000 homes gets approval. https://indynr.com/solar-farm-to-power-175000-homes-gets-approval/
9. The Energy | by Marion Rae (16 October 2025). Policy for a functioning energy market. https://theenergy.co/article/policy-for-a-functioning-energy-market
10. Herald Sun | by James O'Doherty (22 October 2025). Parramatta Rd development: Light rail development could unlock up to 50,000 new homes. https://www.heraldsun.com.au/news/nsw/parramatta-rd-development-light-rail-development-could-unlock-up-to-50000-new-homes/news-story/4c7d97992df549944ec9a597a1eae8d9?btr=c4bb4116e21bd42434bb33ce1bfc39c2
11. Daily Telegraph - Central Coast Express | by Richard Noone (21 October 2025). Gosford: New plans for state significant development at 70 John Whiteway Drive to include student and affordable housing.  https://www.dailytelegraph.com.au/newslocal/central-coast/gosford-new-plans-for-state-significant-development-at-70-john-whiteway-drive-to-include-student-and-affordable-housing/news-story/2f0c7bd5fe890e7ee2955531144be8be?btr=8322d114f03d7e27ba18be8ce50e90cb
12. NT News | by Jim O'Rourke (21 October 2025). Northern Beaches Hospital: Talks to begin on future of vital private health services. https://www.ntnews.com.au/news/nsw/northern-beaches-hospital-talks-to-begin-on-future-of-vital-private-health-services/news-story/c0d1f83a4fa28a10da434cdf0a69fb39?btr=64078cc5ed7886ebd155f6fbb8b632be
13. The Fifth Estate (21 October 2025). Targeted assessment can work, if it’s backed by better strategic planning. https://thefifthestate.com.au/columns/spinifex/targeted-assessment-can-work-if-its-backed-by-better-strategic-planning/
14. NT News | by Nathan Schmidt (21 October 2025). NSW government reaches $190m in-principle agreement over Northern Beaches Hospital. https://www.ntnews.com.au/lifestyle/health/nsw-government-reaches-190m-inprinciple-agreement-over-northern-beaches-hospital/news-story/0ad11747775535089e197bcf47a45095?btr=a7cbea30359664b8f3bac8b692ce1c27
15. By Farid Farid and Kat Wong (21 October 2025). 'Failed model': private hospital back in public hands. https://www.blayneychronicle.com.au/story/9093182/failed-model-private-hospital-back-in-public-hands/
16. Trade Earthmovers | by 15 minutes ago (21 October 2025). Coffs Harbour Bypass hits half way mark. https://www.tradeearthmovers.com.au/coffs-harbour-bypass-hits-half-way-mark/
17. The Nightly | by Kat Wong (21 October 2025). Northern Beaches Hospital: Minns confirms NSW government to take control of scandal- riddled Healthscope facility. https://thenightly.com.au/australia/nsw/northern-beaches-hospital-minns-confirms-nsw-government-to-take-control-of-scandal-riddled-healthscope-facility-c-20416788
18. NT News | by Jake McCallum (22 October 2025). Pyrmont, Ultimo plans: 4000 homes, 27,000 jobs expected to be approved by planning panel. https://www.ntnews.com.au/news/nsw/pyrmont-ultimo-plans-4000-homes-27000-jobs-expected-to-be-approved-by-planning-panel/news-story/ac3ddff0462c533c9ad982df68b7058f?btr=abf521ca6579c63d592aa80d1e8aab14
19. The Good Builder | by TGB Editorial (21 October 2025). Building Trust, Not Tension: How AS 4000:2025 Could Redefine Construction Disputes. https://thegoodbuilder.com.au/building-trust-not-tension-how-as-40002025-could-redefine-construction-disputes/
20. Australian Conveyancer (21 October 2025). Housing Pattern Book starting to ‘bear results’: Taskforce. https://www.australianconveyancer.com.au/article/housing-pattern-book-starting-to-bear-results-taskforce/
21. The Urban Developer | by Patrick Lau. (Date not specified). Knox Street Approval Adds to Double Bay Shoptop Surge. https://www.theurbandeveloper.com/articles/double-bay-mixed-use-office-development
22. The Daily Telegraph. (Date not specified). How 150,000 new homes could be built in Sydney. https://www.dailytelegraph.com.au/dttv/program/politics/how-150000-new-homes-could-be-built-around-sydney/video/7ce37e7c7fc5c0eaac10b4ca771b93ba?btr=0c8ad51f2937c44e6fca9027f91767a2
23. By Mat Johnston (22 October 2025). Preferred bidder nominated for $34.5bn Suburban Rail Loop stations — and it includes two familiar construction giants. https://www.ntnews.com.au/news/victoria/preferred-bidder-nominated-for-345bn-suburban-rail-loop-stations-and-it-includes-two-familiar-construction-giants/news-story/81e6fae23692309c4eb2c2d26ae12371?btr=6f297e77e2c84eb1096500829e39e2c8
24. By Brendan Gullifer (20 October 2025). Renewable Energy Zone farmers say they battle to get fair compensation. https://www.dailytelegraph.com.au/newslocal/dubbo/renewable-energy-zone-farmers-say-they-battle-to-get-fair-compensation/news-story/585731dda523e91d245195a7c23facf1?btr=e8c104860a946609b47d7882472e3eb8
25. By Aidan Devine (20 October 2025). NSW builders sound alarm over major blowout. https://www.realestate.com.au/news/nsw-builders-sound-alarm-over-major-blowout/?cspt=1761087805|3a52e11859636d9463ed27b6579dac6d
26. By MATTHEW WAI (20 October 2025). A new leader emerges in global energy transition. https://www.fssustainability.com.au/a-new-leader-emerges-in-global-energy-transition
27. Energy Source & Distribution News (20 October 2025). Richmond Valley Solar & Storage project gets planning tick. https://esdnews.com.au/richmond-valley-solar-storage-project-gets-planning-tick/
28. Energy Source & Distribution News (20 October 2025). Octopus Australia acquires Coleambally battery project. https://esdnews.com.au/octopus-australia-acquires-coleambally-battery-project/
29. By Mina Martin (22 October 2025). Sydney first-home buyers face one of world's longest waits. https://www.brokernews.com.au/news/breaking-news/sydney-firsthome-buyers-face-one-of-worlds-longest-waits-288279.aspx