This prime inner-city site could house 6000 families, but it’s a toxic mess

Michael Clarke vividly remembers when, as mayor of Maribyrnong in 2009, he visited Canberra to be told the federal government would hand over a sprawling, historic Defence site to create a new suburb in Melbourne’s inner west.

Sixteen years on, the 128-hectare riverside slice of Maribyrnong, just 10 kilometres from the CBD, is no closer to housing families in a possible 6000 new homes.

The soil remains riddled with dangerous chemicals from the site’s former life as an ammunition and explosives factory, while buildings not used since 1994 grow increasingly derelict. The defence minister’s office now signals further delays.

“Everyone was ‘ooh, aah’ … but god, it’s gotten nowhere,” Clarke says. “I understood that the cost of remediation would be an impediment, but not an insurmountable hurdle.

“It’s a hell of a long time coming and particularly given the housing crisis, it’s really ripe for development.”

The Age is strengthening its focus on Melbourne’s booming west as part of a special series examining the positives and challenges the region faces. Later this month, our reporters will moderate a West of Melbourne Economic Development Alliance’s (WoMEDA) summit to discuss a vision for the western suburbs’ success. The alliance of university, industry, community and local government experts works to unlock the west’s economic potential.

Discussions about the Maribyrnong site’s potential started soon after its closure and the state government began negotiations to buy the land in 2004. In 2009, the Commonwealth announced it would clean up the site and sell the land to Victoria.

This agreement was scuppered in 2017 when  the Turnbull government rejected the Andrews government’s final offer in the quest for better value for money, deciding instead to sell to a private developer and offload the cost of remediation. However, the selection process has dragged on for years.

The cost of decontamination has been a major sticking point for the Commonwealth. In 2009, the clean-up bill was estimated at $100 million. Two years ago, the same works were put at about $200 million.

Clarke said the land ticked all the boxes due to its proximity to the city, a tram line and Highpoint Shopping Centre. He called on the Commonwealth to find the resolve and the money for remediation.

“The number of sites that are this big, this close to the CBD, you can count on one hand,” Clarke said.

“You cannot leave that site, given our housing need, idle. There will be a tipping point where demand absolutely requires the federal government to move on cleaning this land up and making it available.”

After the site went on the market in 2018, five property developers were selected to make submissions by July 2024.

The Defence Department last year said it would provide recommendations on the site’s future by early 2025 through a cabinet submission.

A spokeswoman for Assistant Defence Minister Peter Khalil now says not to expect a decision on the Maribyrnong site before the Commonwealth completes its response to an independent audit of its national real estate portfolio, which was finished in December 2023.

“Defence is undertaking further analysis to understand the impacts of the findings and recommendations of the Defence Estate Audit, particularly with respect to personnel and capability,” the spokeswoman said.

“The Albanese government will release its response to the audit this year, once that work is complete.”

While the audit has not been made public, Defence Minister Richard Marles quoted from the report in a speech in June: “Urgent interventions are needed to correct the unsustainable trajectory that has resulted from decades of deferred decisions on contentious estate issues.”

The shortlisted developers have been kept secret. Chinese developer Enrichment Holding released a $2.5 billion vision for the land in 2017 that included carving a canal through the centre and an expected decontamination budget of $300 million.

Company representative Nelly Wang said while the business remained prepared to fulfil its plans, it was not on the Defence Department’s shortlist.

Andrew Gunter, who lives across the Maribyrnong River in Essendon West and runs the Facebook group Maribyrnong Defence Site Neighbours, hopes to see a wide riverside park and medium-density housing close to the tram line.

The site has about three kilometres of river frontage, but remains entirely fenced off, breaking up recreational walking paths.

Gunter called on the Commonwealth to get on with the clean-up. If a private developer had to bear the cost, Gunter said, they would just push down the land value and pass on the remediation bill to eventual buyers.

“It’s contaminated because of Commonwealth use of the land … for completely justifiable reasons, they needed a facility to manufacture this stuff … and they should carry the burden that goes with that.”

Maribyrnong Deputy Mayor Bernadette Thomas said the council had long advocated for the site’s clean-up and reuse, but was still waiting for any movement from the Defence Department.

“The City of Maribyrnong’s population is expected to rise by 55 per cent to about 155,000 by 2051, and this prime site – which has sat unused for 20 years – is crucial to realising the state government’s targets to accommodate 48,000 dwellings across our municipality by 2050,” she said.

The Age sent a list of questions to the Allan government, which has ambitions for 800,000 new homes in Victoria by 2034. In response, a Department of Transport and Planning spokesman said: “The future use or development of this site is a matter for the Commonwealth government.”

The Maribyrnong factory was established in 1908 to manufacture explosives, including bombs, mines and hand grenades. During World War II, there were 8000 workers on site and the workforce was wound down by the ’60s to produce rockets.

The Albanese government reversed a Turnbull-Morrison era position in 2023, saying it would be prepared to wear the clean-up bill if necessary.

The Defence Department is removing some legacy asbestos material from the site, according to its website.

The West of Melbourne Summit, presented by WoMEDA with The Age, will be held on October 22-23. For details go to womeda.com.au

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