Tonsley: South Australia's vision of its manufacturing future

By / 30th of April, 2014
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It's considered a dire time for the manufacturing sector in South Australia, but stakeholders are keeping a close eye on Tonsley industrial park, which is the state government and industry's vision for the future of manufacturing made real.

Less than two years after the funded concept was unveiled, 800 students a day are studying at a new TAFE training centre at Tonsley, six leading companies are preparing to establish their own high-tech presence on the site, and a contractor has been chosen to create a residential and retail development.

Even bigger milestones are less than a year away, including the unveiling of new facilities for Flinders University funded through the single biggest infrastructure investment in the University’s near 50 year history.

Innovyz, a startup accelerator based in Adelaide, has also announced an Innovation Hub in the Tonsley facility. To date, their accelerator program has assisted 45 companies raise funds approaching $20 million dollars.

The Innovation Hub will extend the Innovyz programs for businesses in the health and wellness, advanced manufacturing, resources, mining and energy and applied technology industries. 

March 2015 will see eight companies focused on Health and Wellness products, services and software spend nine months with the Innovyz mentor network, providing them experience of the entire commercialisation process.

"We match start-ups with good innovative ideas along with like-minded investors who share their vision, and show them how to deliver returns on the innovation for the mutual benefit of both the innovators and the investors," said Innovyz chairman Philip Vafiadis.

The Tonsley site, 10 kilometres south of the CBD, is where first Chrysler then Mitsubishi made cars for nearly five decades. Both were major employers and established the site as an integral part of the local community.

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An impression of the completed site.

When Mitsubishi stopped local vehicle production in 2008, the South Australian Government saw the opportunity to nurture a new future for manufacturing and innovation in the State by bringing the high-value industry, education and research sectors together on a purpose-built campus.

It secured the 64-hectare site in 2010 then two years later released a Master Plan and committed $253 million to the redevelopment.

The cluster focus reflects a growing international emphasis on smart specialisation – the bringing together of research and industry to foster economic development based on a region's recognised strengths.

“We are looking first and foremost to build on strengths we already have in SA and in the south and to help the firms in those industries to grow,” said Tonsley Redevelopment Director Megan Antcliff. “At the same time we are looking to attract new industry capability to SA based on the value proposition of Tonsley.” 

Ms Antcliff said there had been a disconnect in having Government agencies out in the market place trying to help SA manufacturers move up the value chain when at the same time the available operating environment didn’t fit what these firms needed.

Tonsley was designed to be an alternative to the remote industrial park commonly associated with manufacturing. It would bridge an infrastructure gap and provide facilities and a range of services – the soft infrastructure – that industry was not in a position to create for itself.

“What’s really interesting is the role Government is playing,” she said. “We’re not at one extreme where we don’t intervene at all and the site becomes a bulky goods or logistics centre and we’re also not doing the other version of a fully subsidised land arrangement for business.

“What we’re doing is saying Government will provide some capital focused on the common whole-of-site services – the brand, all of the site distribution networks such as roads ICT infrastructure and public realm – and then, really importantly, we’re investing in the soft infrastructure, such as support for commercialisation activities and B2B networking.

“We’re asking businesses what they need then working to deliver it." - Megan Antcliff

The Government’s role in the project is being overseen jointly by the Department of Manufacturing, Innovation, Trade, Resources and Energy (DMITRE) and Renewal SA.

The Master Plan for Tonsley looks to create 6300 jobs over 20 years through the Government’s financial commitment – expected over the life of the project to leverage  $1 billion in private investment – and to have 1000 new dwellings in a medium to high density residential community by 2031.

The first companies to come on board were IT company Tier 5, which is investing $113 million in a state-of-the-art data centre, and multinational engineering and advanced technology firm Siemens.

In 2012 Siemens signed an MOU to become a strategic partner in the project, with vice-president of energy David Pryke commenting that “technology precincts offer tremendous potential for innovation and collaboration – essential ingredients for successful business on a global stage". It subsequently committed to develop a new manufacturing facility on site.

Earlier this year, it was announced that Basetec Services, Signostics Limited, Zen Industries and MAN Diesel and Turbo Australia also had signed on (see breakout) and that CIC Australia had been chosen as the residential developer.

Santos, Beach Energy and Senex Energy have also pledged multi-million dollar support for a new Mining and Petroleum Centre of Excellence to be based on site.

The clustering of mining and defence expertise and research capability was the clincher for Basetec, a high-end composite pipeline technologies company, which cancelled plans to build a new complex elsewhere in Adelaide when the Tonsley option was presented.

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Construction is moving at a steady pace, with certain parts of the site up and running already. The roofing was recently completed.

"Our company is looking to collaborate and innovate to grow and prosper and we see Tonsley as the ideal place to do this," said Managing Director Charles Figallo.

He said he knew of nothing like the Tonsley concept and that it was attracting significant attention.

“We are getting a lot of interest now from other companies that want to get involved with us and to be a part of the R&D that we are linking with. I have never seen anything like it. I have been approached by several companies, I have bought out one company in Australia on the strength of this and I have had interest from another in the US.”

Mining and energy is one of four sectors specifically targeted as a focus for the Tonsley development. The others are clean technology, green construction and medical technologies – all areas in which South Australia has a significant commercial and research track record.

Tonsley is also highlighting its own environmental credentials, and is working with the Green Building Council of Australia to achieve one of the nation's first Green Star – Communities ratings.

Environmental infrastructure projects under way on site include a smart grid network to provide increased energy efficiency, and reduced carbon emissions and water sustainable urban design principles to ensure minimal water consumption and potential reuse.

Tonsley will also provide world's best-practice telecommunications infrastructure, with all allotments within easy reach of a fibre optic network.

The Master Plan expects a large proportion of the Government’s $253 million investment to be offset by land sales and rental income. Sales revenue is anticipated to be $144.6 million over 16 years, with rental income forecast as $27.5 million.

About 60% of the site area will be dedicated to commercial and high value manufacturing, 10% to education and training, 28% residential and 2% retail.

The shape and nature of the residential component has yet to be determined, but it is intended that housing will be available to all, not simply to those involved with Tonsley tenants. It is also expected that the buildings will incorporate many of the sustainable building innovations being developed by tenant companies.

To assist the site’s integration with the local community, an existing single-track rail line is being duplicated and electrified to allow for regular scheduled services from the city to a redeveloped Tonsley station. A temporary park-and-ride facility has been opened on site for public use.

A focus in the first year was the refurbishment of the old eight-hectare main assembly building to accommodate a central Town Square and a mix of retail, education, industrial and commercial land uses. This should be completed by year’s end.

Megan Antcliff said it had not taken long for the Tonsley concept to be widely understood and supported, even by those who previously had preconceived ideas about how manufacturing precincts look. Industry was now among the strongest advocates both for the ambitious vision of the project and for the role of the State Government as a partner.

She stops short of calling Tonsley unique, but hasn’t found an equivalent in Australia or overseas. “There are a number of things we’re doing that people have done before, but in this kind of combination, for this kind of purpose, we’re yet to really find the benchmark,” she said.

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TAFE SA have already moved on to the site, with a number of vocational hubs in operation.

Training and Technology

Flinders University and TAFE SA, the State’s main vocational training provider, are anchor partners for the Tonsley development and both have invested in significant infrastructure on site.

TAFE has already opened a new $120 million training facility within the Sustainable Industries Education Centre (SIEC), and will train an anticipated 6500 students a year in sustainable building and construction occupations.

Flinders is not far behind, and is on schedule to unveil its new $120 million, six-storey building next January, as well as a 2,000-square-metre “pod” within the broader Tonsley complex where it will house heavy engineering equipment used for teaching and research.

And spin-off benefits are already being generated. Seeley International, a global leader in developing energy-efficient cooling and heating, announced in January that it would partner with Flinders and TAFE to establish an R&D centre for new energy efficient cooling and heating technologies at nearby Lonsdale. Under an MOU, students will have direct access to Seeley’s expertise and state-of-the-art facilities, while TAFE and Flinders lecturers will deliver training programs for Seeley staff.

TAFE will offer two new courses at Tonsley – renewable energy and water operations – alongside traditional training across 26 disciplines, including electrical, refrigeration and air-conditioning, plumbing, carpentry and joinery, furnishing and building, interior design and drafting, painting and decorating, bricklaying, plastering and tiling.

The new building design retains much of the structure from the original car manufacturing plant, demonstrating the interface between the old and new building practices.

“All the services in the building are on display and act as a constant reminder of the design and construction requirements of a functioning building, which provides an ongoing learning opportunity for students,” said TAFE SA Director Building and Construction, Peter Nolan.

“Digital displays located across the campus constantly show the building’s environmental performance including water and energy use, and the savings being made.”

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There are 800 students studying a day at Tonsley.

The central learning hub gives students studying building and construction disciplines the ability to work side-by-side that replicates industry conditions. A multi-purpose demonstration 4-storey construction site gives students and industry the opportunity to experience real-life building services installations.

The campus also has a state-of-the-art “way-finding” signage system to help students navigate their way through the building. This works in tandem with a new app, which gives them a building map in the palm of their hands.

Flinders will move its School of Computer Science, Engineering and Mathematics to its new Tonsley building, along with its Medical Device Partnering Program, the Centre for NanoScale Science and Technology, and the recently established New Venture Institute (NVI). Further expansion, including possible student accommodation, also will be considered.

Flinders Vice-Chancellor, Professor Michael Barber, said the university’s investment showed its confidence in Tonsley and its potential to be the catalyst for developing the skills and jobs that would “shape an innovative and productive economy”. 

The new building will contain two lecture theatres and 28 specialised laboratories for research and teaching purposes in which students can study a range of disciplines, including biomedical, civil, electrical, electronic, mechanical and software engineering, information technology, network systems and mathematics.

The NVI was established to further strengthen the university’s enterprise culture and support the business and community collaborations that will be an integral part of its Tonsley presence. Its scope will extend from hands-on learning experiences for students to the translation of successful research into leading edge products and services. This will include the potential attraction of capital to support commercial developments.

NVI Director Matthew Salier believes the real value from a university “comes when you can bring cutting-edge thinking and research to actually strategically doing it on the ground”.

“It is not yet known what the next big thing will be,” he said. “What is known is that you need to create the conditions through which people can come together: where you can bring the intellectual horsepower of the university, the experience of your business connections, mentorship and capital to bear to create an environment where these new products and services are likely to flourish.”

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TAFE SA's space is lofty and modern, built in to the existing infrastructure.

That’s a sentiment shared by Charles Figallo, the Managing Director of pipe technology company Basetec, which plans to open a Centre of Excellence in Composites Research and Development as part of its involvement with Tonsley.

Basetec already works closely with university researchers to develop its products and technologies, but Mr Figallo said having researchers and complementary businesses together on site would open new possibilities.

“There are always things changing and new challenges emerging,” he said. “To have so much expertise together is a major attraction of Tonsley.”

The first to commit

Tier 5 and Siemens’ early investment in to the South Australian Tonsley project was a vote of confidence for the future of the site.

Over $100 million of investment is flowing in from Tier 5, who are building a high capacity, environmentally conscious data centre adjacent to the TAFE building.

Siemens have committed $5 million to the development of a maintenance and repair facility at Tonsley, with the aim of being operational in October.

Peter Wildy, chief executive office of Tier 5, said that Tonsley was the ideal location for their advanced data centre, which will utilise modular units supplied by Dell to incrementally build capacity over time.

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Peter Wildy of Tier 5 in front of one of their modular server stacks.

“It’s perfect from a data perspective. About 10 kilometres from the city, close to the airport with good access for customers to the site from two main roads nearby,” he said.

“You also have redundancy in the power supply which is critical for a data centre.”

Tier 5’s eco-friendly initiative takes advantage of Adelaide’s typically cooler climate by cooling their server stacks with natural air, rather than implementing expensive and polluting refrigeration systems.

“It’s great to reuse an existing building from a green point of view,” he said.

Tier 5 first announced their commitment in 2010 and are now preparing the site to roll out capability from July onwards.

The large space and modular server and power units means that Tier 5’s business will be extremely scalable.

Siemens is a company with a long history in South Australia, establishing the first telegraph line between Darwin and Adelaide in the distant past.

Their latest project will be a state-of-the-art purpose built facility employing 25 people, with plans to double that workforce as the business grows.

David Pryke, Siemens’ vice-president of energy, is a strong believer in clustering sites and the benefits they can bring to the businesses involved.

“Technology precincts offer tremendous potential for innovation and collaboration – essential ingredients for successful business on a global stage,” he said.

The facility they’re constructing will service their energy and technology business, a further step cementing the relationship between Siemens and the state of South Australia.

“We’re in the business of creating technology for a sustainable future and it’s a natural progression of our commitment to doing business in South Australia,” Mr Pryke said.

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A breakdown of the major companies and educational facilities at Tonsley. There is also a strong focus on residential and commercial facilities.

Advanced energy

Solar energy and energy storage company ZEN Energy Systems will begin moving into the Sustainable Industries Education Centre from as early as April, while Remotengery and MAN Diesel and Turbo Australia (MDT) have announced plans for a new hybrid energy Centre of Excellence on site.

MDT’s Managing Director, Larry Silva, said the Centre would offer significant opportunities for innovation around hybrid energy, which had potential for remote applications in Australia and the Asia Pacific region.

“This will accelerate the evolution of off-grid energy production, combining the best of renewables with the most efficient diesel, gas and dual fuel engines,” he said.

“It’s a move that should bring economic benefits for regional centres, mining projects and remote communities around the State, giving access to off grid power and desalinated water.”

Mr. Silva said MDT provided engineering support complementing Remotenergy’s expertise to fully integrate wind/solar power, diesel/gas engines into a single remotely-based water purifying solution for regional areas.

“Particularly important is our proven experience in Australia and capacity to offer hands-on technical support for maintenance thus ensuring sustainability,” he said.

Remotenergy Executive Director Barrie Harrop said 30 locations in SA had been identified as possible sites for wind/solar powered hybrid plants.

“In the initial stages this could potentially create several hundred new jobs from our planned base at Tonsley over the next three to five years,” he said.

“As the driest state on the driest continent in the world, SA has a tremendous opportunity to establish a hybrid energy solution to power and water issues and become a global leader in hybrid energy systems.”

ZEN’s will move all of its administration, R&D, technical support, manufacturing, warehouse and distribution operations from its two current site in suburban Norwood and Woodville to Tonsley.

 “Moving in with other advanced operators and educators into one interactive campus can only foster greater innovation,” said Chief Executive Officer Richard Turner.

“This benefits not just our company, but the entire state. Our vision is to collaborate on campus with our best tertiary institutes and aligned smart businesses in SA to form a world class centre of excellence in Adelaide.”

The company is one of the largest solar providers in SA across residential, commercial and utility scale markets, and its revolutionary ZEN PowerBank storage systems allow users to store energy generated by solar or wind power or capture off peak power for later use.

“We have the technology now to generate and store energy in the home or business far cheaper than purchasing that energy from the grid,” Mr Turner said.

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The main assembly building will house a number of industry pods and meeting spaces for students and workers.

South Australia's medical future

Ultrasound manufacturer Signostics Limited?is the first company in the medical field to commit to Tonsley, and according to CEO Warren Ortmann the move from inner suburban Thebarton supports its growth plans.

“This is a great opportunity for us to be closer and ultimately in greater collaboration with like-minded companies in SA,” he said.

“It also enables us to build stronger relationships with cutting-edge university researchers, such as the Medical Device Partnering Program through Flinders University. Tonsley provides the flexibility to expand as our manufacturing requirements increase.”

Initially based in the administration building, Signostics will move to the main assembly building in the second half of 2015.

Mr Ortmann said the company was moving closer to realising its vision of being a world leader in providing clinicians with small, fast and affordable hand-held ultrasound tools for use at the point of care.

“Our growth is the result of the launch of a new product and an OEM partnership with Japanese multinational Konica Minolta, where they sell the product in Japan and the US, with China, India and South America to follow,” he said. 

“We are raising capital to fund the new phase of Signostics. The hand-held ultrasound market is potentially a US$4 billion opportunity, and Signostics is well positioned to capitalise on this.”

Composite materials bring cooperation between academics and industry

Basetec Services’ $9 million commitment to the Tonsley redevelopment with its affiliate NovaFast includes a Centre of Excellence in Composites Research and Development.

“To have so much expertise together is a major attraction of Tonsley.” - Charles Figallo

The State Government will contribute a further $1.5 million towards the Centre to expand South Australia’s capabilities in composite materials research and education and help develop high- value manufacturing.

Managing director Charles Figallo said the Centre?would expand SA’s capabiliites in composite materials research and education while growing Basetec’s global business

It would be designed for research discoveries, post-graduate education, national and international linkages and commercial outputs and would:

  • allow university students to develop ‘hands on’ engineering skills with composite materials
  • assist local and international companies with complex composite design and engineering excellence
  • help engineers to select the right material for their critical processes and gain a better understanding of composite products
  • provide engineered solutions for industry through research and development collaborations
  • provide consultancy and testing services in the areas of structure, materials, composites and computational modelling and analysis.

Basetec will establish its Tonsley facilities through a joint venture with the China National Materials Group Corporation (Sinoma).

The company is well known among the oil and gas, mining, energy and water industries for producing innovative composite materials which have great durability and corrosion resistance.

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A map of the clusters in South Australia. Tonsley is one of the latest, and the industry is keeping a keen eye to see how this model will work for advanced manufacturing.

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The history of Tonsley

  • Tonsley, which was named after Tonsley Hall in England by its second owner, was used for farming until the main estate was bequeathed to the Art Gallery of South Australia in 1946.
  • Ownership later passed to the Housing Trust of SA before Chrysler Australia bought 180 acres in 1955. It first established a motor parts and accessories division there, before adding an engine plant in 1957 and the main assembly plant in 1963.
  • The Tonsley rail line was constructed in 1965/66.
  • Employment peaked at around 7500 in 1979, but the following year Chrysler was taken over by Mitsubishi Motors Australia, which continued production but reduced the workforce.
  • Mitsubishi ceased vehicle manufacture at Tonsley in 2008 (though it maintains an administrative presence on site) and the State Government bought the land in 2010.
  • The Master Plan for the new Tonsley Park redevelopment was released in 2012