How a downturn in demand for office space could help solve Sydney's housing shortage

The post-COVID downturn in demand for office space could present a chance to help solve part of Sydney's housing shortage.

One private developer is teaming up with a community housing provider in the hope of delivering much-needed affordable apartments for frontline health workers.

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Royal North Shore is a major teaching hospital, with more than 100 positions vacant.

Brett Manwaring from community housing providers Evolve Housing says that "one of the key things they're hearing is I can't find affordable accommodation in the area".

Staff at the hospital are instead forced to cop exhausting commutes.

Brad Ernst, an employee at the hospital, said: "I get the 7.19 train from Woy Woy to St Leonards.

"That's two hours travelling time, three hours travelling time out of the day."

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Just up the road at Crows Nest there are plans for a 21-storey office block. Space that is no longer in high demand.

Now developer Third.i has gone back to the drawing board to see if one problem can solve the other.

"We'd like to amend the concept DA to be able to put affordable housing on the site," the developer said.

Their tower is above the new Crows Nest station.

They said that while staying within its original footprint, the amended proposal would swap offices for 300 private apartments in the block.

It would also create another 100 units reserved for health workers to rent at a discount of at least 25 per cent off the market rate.

"You're located above a metro station so you can access most of the major hospitals across Sydney in a matter of minutes," the developer said.

The title for the affordable housing block would be signed over to community provider Evolve, with a potential ripple effect.

"We can probably own and develop a further 400 properties across Sydney as a result of this asset being gifted to us in perpetuity," Manwaring said.

Third.i is hoping that will sweeten the deal for both the community and the planning minister to sign off on the change.