Government backs three initiatives to create hundreds of CBD apartments, jobs

The South Australian government and the City of Adelaide are advancing a suite of housing policies designed to deliver hundreds of new homes in the CBD, create construction jobs and make better use of vacant office space. The initiatives include a major apartment complex on the former Franklin Street bus station site, a financial guarantee scheme for developers and a program to convert empty commercial floors into residential units.

The most visible project is the transformation of the former Franklin Street bus station into a 392-apartment community. According to the Premier's department, construction is scheduled to start in early 2026 and first residents are expected to move in by 2028. More than 35 per cent of the dwellings will be classified as affordable housing, and 196 of the units are designated as build-to-rent, a model that keeps properties under single ownership for long-term leasing rather than selling them individually. The scale of the development means hundreds of construction workers will be employed on site over the next two years, with ongoing staffing needed for property management and maintenance once the complex is operational.

Financial backing for mid-tier projects

To encourage developers to build apartments priced under $1 million, the state government has launched a $500 million financial guarantee scheme. Under the program, the government steps in to acquire unsold units at a 10 per cent discount if sales fail, effectively underwriting a portion of the developer's risk. Policy analysts say this mechanism is intended to unlock stalled mid-tier projects, the kind of developments that provide housing for key workers such as nurses, teachers and hospitality staff who need to live close to the city centre. For residents, the guarantee scheme is expected to boost the supply of new apartments in an affordable price bracket, potentially easing upward pressure on rents and purchase prices in the CBD.

Separately, the City of Adelaide has introduced the Adaptive Reuse City Housing Initiative (ARCHI), a program that targets 50 adaptive reuse dwellings annually by converting vacant office space and rooms above retail premises into residential units. The initiative is backed by $500,000 in state government funding over two years. For local businesses, the program could increase foot traffic in underused commercial corridors as new residents move into floors that were previously empty after business hours. The conversions also reduce demand for new construction materials and energy, supporting the council's broader sustainability goals.

East End towers and long-term planning

Four new towers in Adelaide's East End CBD will deliver a major mixed-use housing development through a partnership between the state government, the City of Adelaide, and housing providers Junction and Unity Housing. The project complements recent policy changes that increased the maximum building heights in the CBD, allowing for denser development. While specific unit numbers for the East End towers have not been disclosed, the combined effect of the Franklin Street site, the ARCHI conversions and the East End towers is expected to add hundreds of new residents to the city centre over the next five years. That population growth will in turn support local retailers, cafes and service providers who have struggled with reduced daytime traffic since the pandemic.

The state is also preparing the Greater Adelaide Regional Plan to replace the existing 30-Year Plan for Greater Adelaide. According to a report prepared for the federal Treasury, substantial capacity has been identified for high-density housing in the CBD and Urban Corridor Zones to meet future housing supply targets. The new plan is expected to set binding density targets and infrastructure investment timelines, which will determine how schools, parks, public transport and health services keep pace with population growth in the city centre.

For Adelaide CBD residents and workers, the combined effect of these policies is a net increase in housing supply, a broader range of price points and new jobs in construction and property services. The challenge for the council and state government will be to ensure that infrastructure, from sewerage and electricity to tram lines and footpaths, is upgraded in step with the influx of new residents expected from 2028 onward.