No, it isn't cruel to keep a dog in an apartment, as long as the dog gets out, has its needs met and isn't left alone all day. What matters is what your dog does with the day, not the square metres.
A client told me recently that someone at the pub called them cruel for having a dog in an apartment. That's a horrible thing to say. You can live in a palace and your dog still stays in the house, and that's what happens to a lot of dogs on big blocks in the suburbs. The yard becomes the walk. People in apartments can't do that, so they're more likely to take their dogs out.
As long as you fulfil your dog, it doesn't matter how much space you've got.
When it does become a problem
Long hours alone is the real one. If nobody's home from eight until six, every day, with no break for the dog, that's a hard life in a house or an apartment. Sort out a lunchtime visit or a walker, or think again about the timing.
A working breed is more homework too. I don't rule them out, but you'll be doing a lot more than the person with an old Cavoodle.
And check your lease and owners corporation rules before you bring a dog home. Each building is different.
How I run the day from an apartment
I use cycles, not one long walk. PLAY, then ANCHOR, then CALM, then the dog just gets to be a dog until the next one. Ten minutes of good play in a lounge room is worth more than a long walk where nobody's paying attention to each other.
You also have somewhere to practise that most houses don't. Start in the hallway outside your door, or the building's indoor car park if it's quiet. Then move out to the street.
Getting from your door to the training spot doesn't count. I call that the silly lead: harness or collar, no rules, we pretend we haven't done any training. Then the real lead goes on and the rules start.
Barking and neighbours
This is what actually gets people into trouble. A dog that barks at every door in the corridor is on guard duty, and it usually has a good view of the door. Teach CALM in a crate or on a tether, in different spots, with the top of the crate covered and the sides open. If the barking is mostly at the window, I've written about that in barking at the window.
If your dog is alone and barking for hours, or you're getting notes under the door, get help sooner rather than later.
Toilet is the other one. Without a yard you need a plan, and teaching your dog to toilet on concrete helps a lot in the city.
I see plenty of apartment dogs around Docklands. If yours is struggling, the private training program is built around how you actually live. I work across Docklands, Newport, Williamstown and Melbourne's inner west, with online support between sessions.