Zoning: why it matters for commercial property

Zoning is a key ingredient to your commercial property and business success.

There is no point finding the perfect location if you cannot legally run your business there or if there are restrictions on how you can operate.

What is a zone?

Across Australia, all land has a designated zone and this tells you how the land within that certain area can be used.

There are generally four zones: residential, commercial, industrial and agricultural. Within these there are often sub-categories, such as those defining what type of commercial and industrial business can be carried out.

The laws around zoning are established by state and territory governments and this means they differ around the nation.

What role does council play in zoning?

It’s up to local councils to decide what zoning is appropriate in their area and to ensure all businesses and properties comply with their regulations.

Anyone buying commercial property, or planning to change or modify their commercial property, should contact their local council to see what they are able to do and what plans and permits they will need.

Zoning matters when…

Business Victoria also suggests checking whether any overlays apply to your property or whether there are any heritage listings that might restrict what you can do.

It says that might be necessary for commercial property if you want to:

* Set up a store, a food business or other type of business.

* Change the look of the existing shop front.

* Put advertising signs on the building.

* Change the internal fit-out of the building.

* Put outdoor seating or heaters on a footpath.

WBP Property Commercial Valuation Manager Justin Thomas says zoning and planning issues dictate use and development, and hence value.

The existing use may not be allowable under the zoning and could possibly be prohibited.

“The existing use may not be allowable under the zoning and could possibly be prohibited,” Thomas says.

“Purchasers must also have regard to planning overlays and investigate future planning proposals in their purchasing decision.”

Thomas says it’s also important to consider the zoning around the immediate area of a property you are thinking about buying.

“Large areas of former industrial land in inner city areas have been rezoned to allow for a more flexible use,” he says.