Estimated Development Cost (EDC) and Employment Estimates

Navigating the Legislation

As of recent legislative updates, State Significant Development (SSD) projects with an infill affordable housing component are subject to specific requirements. Now, it is mandated that an AIQS Certified Quantity Surveyor or RICS Chartered Quantity Surveyor must prepare a detailed calculation of estimated development cost and employment estimates for proposed SSD projects. 

In-fill Affordable Housing (IAH) is a NSW policy that encourages more affordable rental housing in urban centres by offering developers extra building height and floor space. In return, developers must provide a portion of the project as affordable housing, which must be managed by a registered community housing provider and kept affordable for at least 15 years. The rules were moved from the older Affordable Rental Housing SEPP into the Housing State Environmental Planning Policy (SEPP) in 2021, and reforms introduced on 14 December 2023 strengthened the incentives to encourage more private sector participation.

SSD refers to projects that are considered to be of particular importance to NSW due to their scale, economic value, strategic relevance or potential social and environmental impact. Rather than being determined by local councils, these developments are assessed by the NSW Department of Planning, Housing and infrastructure are determined by the Minister for Planning or their delegate. Under the Environmental Planning and Assessment Act 1979 and the State Environment Planning Policy (Planning Systems) 2021, a development cost exceeding certain monetary threshold, the size or complexity of the proposal, the nature of the land use or the project’s location within a strategically identified growth area or precinct. Major residential, commercial, industrial, health, education and infrastructure projects frequently fall within this category.

Understanding the Estimated Development Cost (EDC)

Under recent amendments to the Environmental Planning & Assessment Regulation 2021, the Estimated Development Cost (EDC) has replaced the former Capital Investment Value (CIV) as the key metric used to assess development scale and determine approval pathways.

The Estimated Development Cost (EDC) reflects the total projected cost of completing a development, calculated at the time of lodgement. The EDC must be prepared by an AIQS Certified Quantity Surveyor or an RICS Chartered Quantity Surveyor. The NSW Department of Planning, Housing and Infrastructure requires an EDC report, including a detailed cost breakdown, for development applications where the estimated cost exceeds $3 million. This requirement applies to State Significant Development (SSD), State Significant Infrastructure (SSI), and certain regionally significant projects under local authority jurisdiction.

Capital Investment Value versus Estimated Development Cost

Introduced by the NSW Department of Planning on 4 March 2024, the Estimated Development Cost (EDC) is a key component of the planning process. It influences development approval pathways, assessment fee calculations, and specific requirements for Development Applications (DAs) across State Significant Developments (SSD), State Significant Infrastructure (SSI), and regional and local authorities. The NSW Department of Planning requires that any development application with an EDC exceeding $3 million be supported by a detailed EDC report, including a cost breakdown.

How does this relate to the Capital Improved Value (CIV)?

Essentially, the EDC now supplants the CIV definition, although the calculations and estimates remain consistent. At Archi-QS, we take pride in our expertise in preparing these reports, ensuring compliance with the latest legislation.

Employment Estimates Requirements

In addition to the Estimated Development Cost, employment estimates are now a mandatory requirement for State Significant Development applications, with in-fill affordable housing included.

Employment estimates assess the anticipated workforce generated by development, both during construction and ongoing operational phases. These figures assist consent authorities in evaluating the broader economic and social impacts of proposed developments and are assessed alongside the EDC.

Employment estimates must be prepared by a quantity surveyor and align with the methodology accepted by the NSW Department of Planning, Housing and Infrastructure. When prepared concurrently with an EDC report, this ensures consistency, accuracy, and full compliance with current legislative requirements.

Housing Delivery Authority Pathway

The Housing Delivery Authority (HDA) is a NSW Government initiative established to accelerate housing supply by providing a streamlined assessment pathway for major residential and mixed-use developments. Through the HDA, eligible projects may be recommended for assessment as State Significant Development (SSD), enabling faster and more consistent planning decisions.

Where a development is declared State Significant Development, whether through the HDA or other SSD mechanisms (including qualifying IAH developments), it will trigger the requirement for a certified Estimated Development Cost (EDC) report and employment estimates, prepared by am AIQS or RICS accredited Quantity Surveyor.

Why Choose Archi-QS?

• Qualified Professionals: Our team comprises qualified quantity surveyors who are members of reputable professional bodies such as the Australian Institute of Quantity Surveyors (AIQS). Backed by over 30 years of industry experience at Archi-QS, our expertise and professional accreditation ensure the delivery of accurate, reliable, and fully compliant reports you can trust. 
• In-depth Understanding: We possess a comprehensive understanding of the Environmental Planning & Assessment (EP&A) Regulation and its requirements concerning EDC and employment calculations. This enables us to provide precise estimations while adhering to regulatory standards.
• Tailored Solutions: Each development project is unique, and our approach reflects this. We work closely with clients to understand their specific requirements and deliver customised reports that align with their objectives.
• Compliance Assurance: With Archi-QS, you can rest assured that your reports will meet all regulatory requirements outlined by the NSW Department of Planning.

Get in Touch

Ensure compliance and success for your development project with our expertise. Contact us today to learn more about how we can assist your Estimated Development Cost (EDC) assessments and Employment Estimates.