Legal
YOUR LAND IS WORTH MILLIONS - UNTIL THE STATE MAKES ITS OWN PLANS
Author: Clare Burnett
The Urban Developer
A landmark payout and new planning amendments have reshaped compensation for planning blight across Victoria.
The P&E Amendment Act—although not a direct response to the Barrett case—significantly cuts back on the compensation which can be claimed. Planning blight in the spotlight Planning blight has been a point of contention across state lines.
In a case earlier this year, a Supreme Court of Victoria judgement over a tract of land at Wyndham Vale awarded a developer $27.92 million after the site was earmarked by the Victorian Government for transport infrastructure and a grasslands reserve. Transport for Victoria initially offered nothing in compensation for land reserved under a Public Acquisition Overlay (PAO), and the Barrett v Transport for Victoria case made waves in the industry, highlighting the ongoing issue of planning blight, Gadens partner Andrea Towson says. “It’s not the first case to consider compensation for planning blight under the Planning and Environment Act 1987 (Vic), but it is a landmark for two reasons: the sheer scale of the award, and the clarity it brings to how these claims should be valued,” Towson says. Planning blight is the drop in property value and sale difficulty that happens when government plans or public projects—such as a future road, railway, or school—restrict how land can be used or leave owners in limbo. Now, rules that came into effect this month are changing the game again. The Planning Amendment (Better Decisions Made Faster) Act—better known as the P&E Amendment Act—took effect on September 1, 2026, severely narrowing the compensation regime for planning blight claims.
The Barrett development site was also overlayed for the Western Grasslands Reserve.
It is especially apparent when governments are undertaking infrastructure work, whether it’s the Suburban Rail Loop, NSW’s Metro expansions, or Brisbane’s Cross River Rail infrastructure. In the Barrett case, the Court heard that developer Jeffrey Barrett had owned land at 1005 Ballan Road at Wyndham
8 – September / October 2026
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