In an effort to streamline the calculation of development costs, the NSW Government has introduced a new method called “Estimated Development Cost” or EDC. EDC will now replace previously used terms such as “Cost of Development” and “Capital Investment Value (CIV)”, which have been made redundant. As of March 4th 2024, the EDC is being used by professional bodies working with the NSW Government.
What is Estimated Development Cost (EDC)?
EDC was created as a simpler, easier, and more transparent way to estimate the development cost of a project and will now be used across the planning system. The implementation of the EDC will alter the way fees are calculated for developments across local, regional, and state-significant development.
The EDC of a proposed project will play a crucial role in many planning aspects, most significantly by:
• Determining the appropriate development approval pathway,
• Calculating the associated assessment fees, and
• Dictating specific Development Application (DA) requirements.
How was EDC created?
The EDC reform aims to respond to the Independent Commission Against Corruption’s Operation Dasha report, which recommended changes to the development process. These changes were primarily brought about the increase transparency of development costs of projects and reduce the risk of corruption.
The Department of Planning, Housing and Infrastructure (DPHI) is implementing this change by amending the Environmental Planning and Assessment Regulation 2021 and other relevant planning policies.
Where does EDC apply?
As the new primary system for determining project costs, EDC will be implemented on projects across different industries and categories, including:
- State Significant Developments (SSDs),
- State Significant Infrastructure (SSI),
- Regional Developments, and
- Development Handled by Local Authorities.
Rules for Using EDC
As with all new Policy and Legislation, rules and laws have been put in place to govern the necessity of EDC. Mitchell Brandtman has provided a guide for EDC requirements below:
Projects Costing more than $3 Million
On projects that have a value of more than $3 million, an EDC report must be prepared by a Qualified Quantity Surveyor (AIQS/RICS member etc.) Additionally, the EDC Report must follow the AIQS Practice Standard.
State Significant Applications
For projects that are considered State Significant Applications, and EDC report must be created in line with the AIQS Practice Standard by a Qualified Quantity Surveyor. The EDC must be submitted in the “Standard Form of EDC Report – State Significant Projects” and dated within 30 days of submission.
Projects Costing less than $3 Million
On projects with a value of less than $3 million, Planning NSW recommends preparing a Cost Estimate Report at a minimum. Please note that projects conducted with Individual Councils will also have specific application requirements which must also be followed.
How can Mitchell Brandtman help?
Mitchell Brandtman understands that the introduction of the EDC legislation could be a source of difficulty for many of our clients. To this end, we have ensured that our experienced team of Quantity Surveyors is fully aware of the EDC reporting requirements.
Detailed Project Knowledge: Mitchell Brandtman goes beyond following guidelines. Each project is treated uniquely, and we will work closely with our valued clients to ensure we have a full understanding of the needs of development. This will allow us to create and deliver bespoke EDC reports that seamlessly align with the project objectives.
Unmatched Experience: Our team is made up of expert Quantity Surveyors, with years of knowledge in the industry. Each of our team members is accredited by the AIQS and will leverage their extensive construction and development knowledge to deliver accurate and compliant EDC reports that meet all regulatory requirements.
Efficiency & Peace of Mind: Mitchell Brandtman understands the importance of efficiency throughout the development approval process. As such, we have tailored our approach to EDC reporting to ensure a timely delivery for our clients – achieved by minimising delays to enable successful completion. This allows our clients to focus on their primary goal, bringing projects to life, with the peace of mind that comes from knowing your EDC reporting is in expert hands.
To find out more information about the Estimated Development Cost Report visit this link.