This document explores how different city shapes and growth patterns impact the state’s economy, the environment, and the quality of life of Victorians.

Infrastructure Victoria modelled five different, possible urban development futures for Melbourne and Victoria's largest regional cities over 30 years. Infrastructure Victoria explored the impact of different city shapes on where people choose to live and work, the jobs and services they can access, how much land is used for housing, travel patterns, the impact on our environment and the infrastructure that is needed.

The results of the scenario modelling tell us that more compact cities perform better on many indicators including:

• More compact cities offer businesses better opportunities to hire great staff and connect with customers and markets. Victorians would be up to $43 billion better off by 2056 with more compact cities compared to growth being dispersed across the state.
• More compact cities also mean more land for agriculture and wildlife habitat. A sprawling, dispersed city consumes an extra 30,000 hectares of land compared to a compact city – equivalent to over 12,000 times the field size of the Melbourne Cricket Ground.
• People living in dispersed cities would spend up to 70% more time in congested traffic to get to jobs and services.
• Over 25% more people would use public transport in a more compact city than in a dispersed city.
• Infrastructure in a dispersed city costs the government about $41 billion more by 2056, or $59,000 extra for every new home built, compared to a compact city.

The future shape of Melbourne and Victoria's regional cities will have big impacts for Victorians' quality of life, the economy, and the environment as the state grows.

The current pathway of growth is more people living away from existing infrastructure in new suburbs on the urban fringes of our cities. Infrastructure Victoria's evidence shows that this delivers worse quality of life and limits opportunities for Victorians. But it’s not too late to turn that around.

The report makes five recommendations to the Victorian government to help achieve more compact and connected cities. It also suggests ways to reduce some of the challenges that come with more compact urban development.