1. This case involves a proposal to construct a 17 storey building on a consolidated site that has frontage to both Johnston Street and Stafford Street in Abbotsford. The Council and some members of the surrounding community say it is too high. The Applicant acknowledges it is a significant and intensive change to the existing low scale character of this area, but submits this degree of change is encouraged by the planning policies in the Yarra Planning Scheme.
2. The key issue in this case is whether the proposed 17 storey building is acceptable in its context. Whilst the site is in a Business 1 Zone where intensive development is encouraged, there are no overlay controls that provide any guidance about the design or height of buildings. Whilst the State and local planning policy frameworks apply to this site, there are no specific policies to guide development in this area and on this site.
3. Johnston Street is a nominated neighbourhood activity centre in the local policies but it is not what we would describe as a vibrant centre. The area is run down and we agree with the Applicant that some stimulus would assist in improving the activity and prosperity of the centre. This consolidated site is large and therefore ripe for redevelopment. None of the parties suggested its redevelopment is not a good planning outcome. Indeed this site typifies this area's potential for redevelopment and we can anticipate that further development is likely to occur over time in this neighbourhood activity centre. The issue is the form of the development that should take place and, more specifically, the height of such development.
4. This has been a difficult case to determine. The parties have differing ideas as to what is an acceptable building height in Johnston Street:
   • The Applicant proposes 17 storeys;
   • The Council has refused 17 storeys;
   • The Council's expert urban design witness (Mr Hutson) is of the view 11 storeys is appropriate;
   • The Council's planning officer and urban design consultant suggest reducing the 17 storey tower by one level and reducing the rear of the tower by a further two levels, i.e. to 14-16 storeys; and
   • The community members suggested the height should be 2 storeys to Johnston Street, then a setback of 7 metres to a height of 4 storeys; with a total height of 6 storeys only if particular attributes are included such as affordable housing.
5. We cannot agree with or support the community views on the height as they do not accord with the strategy for building heights generally of 5-6 storeys in the local planning policy framework of the planning scheme. In our opinion, this site could be built to this height at a minimum. Further, there is common ground between the Council and the Applicant that this site is suitable for a taller building, i.e. taller than 5-6 storeys. The question is how tall as, arguably, buildings of 11, 14-16 or 17 storeys could all be described as tall buildings.
6. There is nothing in the planning controls or the planning policies to indicate which of the building height solutions put forward during the hearing represents an acceptable outcome for this site in this case. The Applicant invited us to look to the future in considering this proposal as "that is what town planning is all about". The Applicant described this proposal as a "pioneer" in Abbotsford that will set a high standard of urban design and will provide a meaningful contribution to, and method of, implementing Metropolitan urban consolidation policy.
7. As we explained to the parties during the hearing, what we have to decide is whether this proposal, at 17 storeys, is acceptable. This brings into question what factors should guide our decision making? Based on the submissions and evidence presented[1] our decision has considered:
   1. the physical context of the site and surrounds including the Johnston Street neighbourhood activity centre;
   2. the State and local planning policies in the Yarra Planning Scheme;
   3. the opportunity to address broader Metropolitan issues such as population imperatives; and
   4. the relevance of other VCAT and Supreme Court of Victoria decisions.
8. The community representatives raised other issues including:
   • The appropriateness of the proposed building as viewed from Stafford Street and other residential streets to the rear;
   • The overshadowing to surrounding properties;
   • The proximity of the new building to an abutting industrial business and the railway line; and
   • The impact of the car parking and traffic generated by the proposal.
9. We have decided not to deal with the last two issues or some of the matters of design detail[2] that arose during the hearing as they are all secondary matters to be considered if we find the proposed 17 storey building is acceptable. For the reasons we elaborate on below, we have concluded it is not acceptable.
10. The State planning policies of urban consolidation, housing diversity and affordability; and the economic and social benefits of revitalising Johnston Street are benefits that weigh in favour of this proposal. However, unlike a principal or major activity centre, development within a neighbourhood activity centre is to fit the context and enhance the character of the area. Having regard to the characteristics of Johnston Street neighbourhood activity centre in comparison to the characteristics of the City of Yarra's major activity centres, we are unable to conclude that this proposal is acceptable. In the absence of clear policy directions or planning controls that specifically encourage significant or intensive change in Johnston Street of the magnitude proposed in this application, we are unable to conclude this proposal fits the context and enhances the character of the area.

1. There are three matters that we wish to highlight at the starting point of our consideration of the proposed 17 storey building, being:
   • The zoning of the land;
   • Activity centre policy; and
   • The physical context of the site.

1. The only planning control relevant to built form that is applicable to this site is the Business 1 Zone. This zone also applies to the adjoining properties to the east and west (between the railway line, Johnston Street, Park Street and Stafford Street). On the south side of Stafford Street and further southeast (beyond Park Street) the land is zoned Residential 1. On the north side of Johnston Street, the land is zoned Business 3 and accommodation (other than a caretaker's house) is prohibited. Hence, we find this is an area where a diverse range of land uses are permitted that will, in turn, have differing building forms and heights.
2. The purpose of the Business 1 Zone is twofold - to implement the State and local planning policies and to encourage the intensive development of retailing and other complementary commercial, entertainment and community uses. Mr Biacsi highlighted the reference to intensive development as one factor that defines the expectation of change and opens the door for the magnitude of this proposal. It must be remembered this zone applies equally to principal and major activity centres, including each of the major activity centres in this municipality. Therefore the intensity of development will be influenced by the hierarchy of activity centres and the extent to which change is contemplated for this neighbourhood activity centre by the policies in the planning scheme.

1. The hierarchy of activity centres is explained in the State planning policies and makes the following distinction in regard to residential development in activity centres:
   • A principal/major activity centre encourages intensive residential development.
   • A neighbourhood activity centre encourages higher density housing that fits the context and enhances the character of the area.
2. Hence, the degree of change is significant in principal and major activity centres because intensive residential development is encouraged without any limitation. Whereas a neighbourhood activity centre encourages higher density housing with a limitation that it fit the context and enhance the character of the area. "The context" is a broad term that refers to both the strategic context and the physical context of the site and the activity centre. This is because on face value one might think fitting the context means fitting in with what exists. However, Metropolitan urban consolidation policy expects more than that. The question for this neighbourhood activity centre is how much more. To determine this, one must be guided by the policies in the planning scheme. If the strategic context does not specifically encourage intensive or substantial change (a term used by the Applicant during the hearing), then the higher density housing is encouraged to fit the context of the activity centre, being the existing physical context.
3. The local planning policies identify the whole length of Johnston Street as a neighbourhood activity centre in the Activity Centre and Abbotsford Neighbourhood sections of the Municipal Strategic Statement (MSS). There is no policy statement in either section about the specific role of a neighbourhood activity centre other than the following statement in clause 21.04-2 that distinguishes between major and other activity centres:

While the Major Activity Centres will continue to be supported to grow and prosper, the need for the provision of shops and services to provide for local day-to-day needs must be met in all activity centres.

1. The Activity Centre section of the MSS has an objective to maintain the long term viability of activity centres with strategies to achieve this that include:
   • Support land use change and development that contributes to the adaptation, redevelopment and economic growth of existing activity centres.
   • Permit residential development that does not compromise the business function of activity centres.
2. We note this objective and the strategies do not distinguish between major or neighbourhood activity centres. There is nothing in the local policies about activity centres that lead us to conclude intensive or substantial change is envisaged for Johnston Street or the neighbourhood activity centres more generally within the municipality.
3. A neighbourhood activity centre is a lower order centre than a major activity centre. We note the MSS identifies in its strategic framework plan a number of major activity centres including Swan Street, Bridge Road, Victoria Street, Smith Street and Brunswick Street. There are also a few neighbourhood activity centres including Johnston Street between Nicholson Street in the west and the Yarra River in the east, broken by the intersecting major activity centres along Smith and Brunswick Streets[3]. However, there is nothing in the MSS or local planning policies that provide clear direction as to the current or future roles of any of the neighbourhood activity centres, including Johnston Street. Therefore, we are unable to conclude that the local planning policy framework encourages intensive or substantial change in this neighbourhood activity centre. The State Activity Centre planning policy still encourages higher density housing in neighbourhood activity centres that fits the context and enhances the character of the area, which brings us to the physical context of this site and activity centre.

1. The Council described Johnston Street as a "clearly two storey Victorian/Edwardian streetscape save for the GlaxoSmithKline building on the corner of Trenerry Crescent at 5 storeys". The Applicant does not disagree with this description but submitted the physical context supports a different and taller built form outcome on this site because:

1. The public housing towers in Hoddle Street "have a strong and close association with the neighbourhood and the activity centre". The Applicant considers they draw attention away from the heart of the neighbourhood activity centre and serve to weaken its sense of place; but at the same time they also establish this area as one of Yarra's pockets of taller buildings. 2. The proximity of the site to a train station and railway line provides a robust environment that is not sensitive to change.

1. The Boemo land (an industrial activity) to the west, the public housing land to the south in Stafford Street, and the VicTrack land and petrol station to the north of Johnston Street are all large parcels of land that are also candidates for new and taller built forms.

1. The nearest dwellings are either zoned Business 1 or are set back in a landscaped setting (the public housing to the south). 2. The Johnston Street streetscape between Hoddle Street and the Yarra River in particular is drab and run down. 3. There is substantial separation distance to the established low rise residential areas to the south and east. 4. The location of the site on the south side of Johnston Street means it will not cast shadows onto the retail pedestrian spine and can mark the hub of the activity centre.
2. We accept that many of these attributes of the physical context do support a building that is taller than the prevailing 1-3 storey built form in the area. However this equally applies whether the proposed new building is 5-6 storeys or higher.
3. We are not persuaded two of the attributes have the degree of influence suggested by the Applicant. The first is the site's proximity to the train station that Mr Biles stated creates a 'hub' in this activity centre. Whilst a railway station is a point of activation, this is a linear activity centre along the spine of Johnston Street that extends for quite some distance. It crosses Hoddle Street, intersects with two major activity centres, and has bus stops that also intersect with each of these points. As such, we are not persuaded this site that is in a mid-block location and not on a street corner is a hub within this activity centre.
4. Johnston Street is a collection of industrial and commercial businesses, retail shop fronts, some of which are vacant, and residential houses. We agree with the Applicant's description of the area in the permit application documentation as underutilised and containing a variety of empty shop fronts and a desolate Victoria Park football ground. A small supermarket has opened recently on the opposite side of Johnston Street, but in our opinion the existing range of businesses in Johnston Street cannot be described as comprising a thriving centre that fulfils the daily needs of its community. It is not easy for pedestrians or possible future residents to easily access cafes, shops and the range of services generally associated with the daily needs of a community. Given these characteristics, we are again not persuaded that there is any obvious 'hubs', including in proximity to this site.
5. The second attribute we wish to comment on is the public housing towers in Hoddle Street. We are not persuaded they form part of, or have a close association with, this section of Johnston Street, east of Hoddle Street. They are part of the broader context and are some distance away across Hoddle Street and are well set back from Johnston Street. They are tall buildings that are visible from long distance views to the east and to limited degrees when travelling west along Johnston Street. However, they read as a distant backdrop to Johnston Street rather than forming part of the context of Johnston Street.
6. To date, the only significant built form change along Johnston Street itself (east of Hoddle Street) is the 5 storey GlaxoSmithKline building at the eastern end on the corner of Trenerry Crescent. Otherwise, the parties agreed the buildings in the immediate vicinity are generally low rise at one to three storeys. It is within this physical context that we must consider the merits of the proposed design.

1. During the hearing, we asked a few times how the 17 storey height of the proposed building had been determined. At the end of the Applicant's case, Mr Gobbo explained the 17 storeys was determined by being ResCode compliant[4] in regard to the potential shadow impact upon residential properties to the south and east in the Residential 1 Zone. He stated the design was then backfilled in regard to its modulation and scale.
2. The residents expressed concern about amenity impacts upon residential properties zoned business and residential. We agree with the planning evidence presented that there would be no unreasonable amenity impacts resulting from a tall building (whether it be 11, 14-16 or 17 storeys) for the following reasons:
   • The closest residents in Park Street live in converted industrial premises that are zoned Business 1 rather than Residential 1. This zoning has implications for the amenity tests to be applied to these properties. The overshadowing impact on these residences is acceptable as a reasonable level of daylight penetration is still maintained. Any overlooking from proposed balconies into the habitable windows or private open space areas of these residences can be appropriately managed by screening.
   • The overshadowing of the residentially zoned public housing estate on the south side of Stafford Street is limited to the communal garden area and, in our opinion, is minimal and therefore acceptable.
   • The overshadowing of the residentially zoned properties to the east of Park Street is minimal and therefore acceptable.

THE ACCEPTABILITY OF THE PROPOSAL IN ITS PHYSICAL CONTEXT

1. Because higher density residential development in a neighbourhood activity centre is required to fit the context and enhance the character of the area, we have considered the physical context and particularly the Johnston Street and Stafford Street streetscapes.

1. Mr Hutson gave evidence for the Council that a 1:1 ratio of building height to building setback should be adopted because it will maintain a human scale to the public realm of this section of Johnston Street, east of Hoddle Street. He stated the height to street width relationship is important to the public appreciation and perception of a street, and it involves a qualitative appreciation of weighing up the public realm versus the development potential of land. In support of his view, Mr Hutson referred to the document "Transforming Australian Cities"[5] as it contains images of potential development along Johnston Street that suggests building height based on a 1:1 ratio[6].
2. The Applicant's submission described this idea of a 1:1 ratio as quite arbitrary and a blunt instrument that is likely to curtail design creativity and innovation. However, Mr Biles[7] agreed with Mr Hutson that the principle of the 1:1 ratio has legitimacy, particularly along linear corridors but not at nodal or focal points. Mr Biles stated a 1:1 ratio in Johnston Street, west of Hoddle Street works well because it has a much finer grain and a greater presence of Victorian and Edwardian buildings. However, Mr Biles' opinion is that the area around the railway station and Hoddle Street is a node where higher development should be encouraged.
3. As we have already stated, other than the fact that the Victoria Park train station is located close to the site, we are not persuaded there is anything about the physical context of this site that identifies it as a hub or focal/nodal point. We have been persuaded by the consensus between Mr Biles and Mr Hutson that a 1:1 ratio has legitimacy along linear corridors such as Johnston Street in considering the merits of this design.

1. A podium height in the order of 5-6 storeys would accord with a 1:1 ratio based on the general width of the Johnston Street road reserve. This proposal is different in that it includes 9 storeys comprising:
   • Two storeys generally built to the Johnston Street boundary (encompassing the retention of the front of the existing St Crispin House building that actually has a 2-3 storey building scale);
   • A third storey that has balconies built to the Johnston Street boundary with the walls set back between 1.5 and 3.6 metres; and
   • A further six storeys with walls set back between 5 and 8 metres from Johnston Street and balconies set back between 3 and 6.45 metres from Johnston Street.
2. We are not persuaded by the Applicant's submission that the building height of the podium has been well managed to provide a pedestrian related scale at the street level. We find there is logic in the principle of a 1:1 ratio that will create a human scale along Johnston Street and thereby enhance the public realm. The GlaxoSmithKline building is helpful in this regard as its height is similar to the width of the Johnston Street road reserve, i.e. it generally achieves a 1:1 ratio. It provides an actual example of the approximate scale that could be achieved in the future on both sides of Johnston Street based on a 1:1 ratio. This is a change to the existing 1-3 storey building scale but, in our opinion, it would be a level of change which could be contemplated in this locality within the existing strategic framework of the planning scheme. As such, we find the podium height along the Johnston Street frontage should be in the order of 5-6 storeys, and the proposed podium is too high.

1. The residents expressed concern about the appropriateness of a six storey building height along the majority of the Stafford Street frontage of this site. At present the industrial, commercial and residential buildings in Stafford Street are generally 1-2 storeys other than the public housing estate opposite the site, which has a three storey height.
2. Mr Fricke asked Mr Biles why a six storey height in Stafford Street was appropriate given it does not achieve a 1:1 ratio as was discussed during the hearing in regard to the Johnston Street streetscape. We think this is a pertinent question. Mr Biles' view is the proposed six storeys is still at a human scale. Mr Hutson's view is six storeys can be accommodated in this section of Stafford Street because the public housing building opposite is constructed on an angle with increasing setbacks from Stafford Street. It is appropriate to build to the Stafford Street frontage of this site, but we are not persuaded a six storey height achieves an acceptable human scale in what is a narrower residential street than Johnston Street. Whilst the site has a business zoning, this section of Stafford Street does have an interface with the residential hinterland, therefore we find the six storey podium height needs to be reduced to achieve an acceptable fit within this adjacent residential context.

1. Above the podium, Mr Hutson said the setbacks of this proposal would need to be mirrored on the opposite side of Johnston Street in order to maintain a 1:1 ratio[8]. In other words, the height and setbacks of the proposed building would impact upon the development potential of the land on the opposite side of Johnston Street. This is problematic as there are no planning controls or policy guidelines that give effect to this urban design outcome. If we were to adopt Mr Hutson's approach, the approval of a building higher than 5-6 storeys on this site would necessitate a restriction in the development potential of the land on the opposite side of Johnston Street in order to maintain a 1:1 ratio. This is not achievable as it is beyond our power to impose development requirements upon that land.
2. In any event, we are not persuaded that a 1:1 ratio should be required for the tower as it is the podium that has the direct relationship with the public realm, not the tower. If we do not accept a 1:1 ratio, there is a real question as to what height or heights are acceptable along Johnston Street. It is evident in this case that there are differing opinions as to what the height of the tower should be:
   • The Applicant has designed the proposed building at 17 storeys;
   • Mr Hutson thinks 11 storeys is appropriate; and
   • The Council's planning officer and urban design consultant suggest 14-16 storeys.
3. Having regard to the existing physical context of low rise buildings, there is nothing that persuades us that any one of these building heights is the acceptable outcome. Indeed one could pose the question why stop at 17 storeys? Why not more?
4. Mr Biles stated the proposal would be "a pioneering building" that will start the process of capital investment in Johnston Street, and his support for 17 storeys is based upon this site being part of a node around the train station. We have already stated we are not persuaded the area around the train station is a 'hub' or nodal point in this activity centre. With such differing views as to what the height on this site should be and in the absence of clear direction from the planning scheme about a preferred height not just for this site but also for this activity centre as a whole; we are not persuaded that any one of these views is the preferable or acceptable outcome having regard to the existing physical context of this neighbourhood activity centre.
5. Given this, we do not intend to make any findings about the design detail other than to make one observation. The Applicant suggested the proposal reflects the disparate subdivision pattern of the Johnston Street and Abbotsford area in a vertical form through modulating façade design and articulation. We acknowledge the proposal has an interesting façade treatment, but we fail to understand how this relates in any way to the scale of the tower.

IS THERE OTHER STRATEGIC SUPPORT FOR 17 STOREYS IN JOHNSTON STREET NEIGHBOURHOOD ACTIVITY CENTRE?

1. As we are not persuaded that a building of 17 storeys on this site fits the context or enhances the character of the area, this brings us to the question as to whether there are other strategic reasons to find this proposal is acceptable in this neighbourhood activity centre.

1. Mr Biacsi identified a number of social and economic benefits to be derived from this proposal during cross-examination. These include enhancing the physical environment; activating the streets; creating new investment opportunities; creating a catalyst for further investment; bringing new retailers to the area; improving the 24 hour useability of the area; and increasing safety. He stated the new residents would add to the amenity of the activity centre. We agree such benefits would be created by new residential development in Johnston Street, but find this would occur whether the residential development is 5-6, 11, 14-16 or 17 storeys. Therefore, whilst these benefits are a relevant factor in favour of the development of this site, we are not persuaded they are determinative for a 17 storey building.

1. Mr Govenlock stated each municipality in Melbourne has a role to play in providing new housing opportunities to meet Melbourne's significant population growth as recognised in Melbourne 2030 and Melbourne @ 5 Million. He also stated inner municipalities such as Yarra must play a more significant role because of their proximity to the central city, the abundance of public transport, and the range of activity centres available within a compact context. His expert report was critical of the City of Yarra for not meeting its population targets[9] based on a document titled Delivering on Melbourne's Population Plan (November 2010)[10]. Mr Govenlock's report refers to this document ranking the City of Yarra 22nd out of 31 metropolitan Councils for new dwelling approvals between 2007 and 2009 and giving the municipality a score of 45% for housing provision[11] as it had a 3 year average dwelling provision rate of 355 compared to an annual target under Melbourne @ 5 Million of 460 dwellings. As such, Mr Govenlock's opinion was that Yarra has significant room for improvement in its housing provision and the contribution this proposal could make is "an important opportunity not to be wasted".
2. A list of the residential apartments/dwellings that have been approved and/or developed between 2009 and 2011 was tabled by Ms Daulizio during the hearing. This list includes 1500 and 900 dwellings for the last two years respectively. The Council also tabled statistics from 2001 to 2010 that show dwelling approvals in 2010 were over 1500 dwellings. Based on this tabled information, Mr Govenlock agreed the annual population target is therefore being exceeded in Yarra. Ms Daulizio also pointed out the dwelling approvals in Abbotsford between June 2009 and April 2011 were 1,523 dwellings. All of these figures, and particularly the more recent figures, demonstrate to us that the municipality is exceeding its population targets and that a significant number of dwellings have been approved in Abbotsford.
3. Mr Govenlock's evidence was that the City of Yarra needs to "step up to the plate" and provide greater housing because of the attributes of its inner city location. There is no doubt in our minds that this is occurring given the number of approved apartment style developments (in particular) in Smith Street, around Brunswick Street, around Bridge Road, along Trenerry Crescent and around Victoria Gardens; and the fact that a number of these approvals are currently under construction.
4. Mr Govenlock stated in his evidence in chief that this site is one of a finite number of large sites available for development within the municipality. We are not persuaded by this as this site is an example of how opportunities for development can be achieved by consolidating land. In addition, during the hearing many of the submitters and experts talked about the possible future of Johnston Street, including opportunities to consolidate sites along both sides of this eastern section of Johnston Street to create further development opportunities. Indeed, we note Mr Govenlock then conceded during cross-examination that there are many sites (albeit not as large as this consolidated site) that have the opportunity to contribute to the growing population of the City of Yarra.
5. Mr Govenlock and Mr Biacsi both argued that if further development does not occur here, in inner Melbourne, it will force further increases in housing out on the urban fringe of metropolitan Melbourne. This view was also reinforced in Mr Gobbo's submission. This concern goes to the heart of the State policy of urban consolidation. We agree with the Council's submission and the Applicant's planning witnesses[12] that this does not mean there should be development at any cost on this site. We are not persuaded by the evidence that the provision of housing in the City of Yarra is not being appropriately provided for within the existing strategic framework of the planning scheme. We agree with Mr Wren that the number of apartments provided in this development (204) is not a determinative factor.

1. The State Housing policy has an objective to identify strategic redevelopment sites for large residential development in metropolitan Melbourne. Some of the submissions by the residents made reference to the fact that this site is not nominated in the local planning policy framework as a strategic redevelopment site. This is technically correct but this is not the only way a site can be classified as a strategic redevelopment site. Clause 16.01-3 of the State Housing policy contains a list of criteria to identify such sites, and the Council acknowledges this site meets a number of these criteria. Hence, this site is identified as a strategic redevelopment site.
2. Clause 21.04 of the MSS acknowledges the majority of new development in the municipality will be accommodated on strategic redevelopment sites. However, this does not mean the development opportunity created on this site is unconstrained. In Common Equity Housing[13], the Tribunal dealt with a site that was not nominated in the planning scheme as a strategic redevelopment site and stated:
   1. We do not think the mapped and listed sites should be regarded as being exclusive. It will not always be possible to identify such sites into the future and opportunities that present themselves that fit the location criteria should be able to be considered for higher scale development. Any redevelopment will involve an assessment of a site's physical and planning contexts resulting in different responses in different settings. That does not mean any site that can fit more than 10 dwellings in Yarra should be contemplated for 5-6+ storeys.
3. We agree with the above and find that the identification of this site as a strategic redevelopment site does not provide any further assistance in determining the intensity of development that should occur on such sites[14], including what building height and form is acceptable for this site. Mr Gobbo stated the site's characterisation as a strategic redevelopment site means it is to be developed in the context of future character and change, which is supported and encouraged by the correct application of local planning policy, rather than being deferential to the established character of Johnston Street or the residential areas behind Johnston Street. Again, we agree with the findings in Common Equity Housing that a site's physical and planning context needs to be assessed to determine what the design response should be. We have already found we are not persuaded a building of 17 storeys fits in with the existing context or enhances the character of the area. This brings us to the future character and change anticipated in the local planning policy framework.

1. A recurring theme throughout the MSS is the Council's vision for a low rise built form character with pockets of higher development. There was focus during the hearing on strategy 17.2 in the MSS that states in part:

Development on strategic redevelopment sites or within activity centres should generally be no more than 5-6 storeys unless ...

1. This is the only reference to building height in the built form section of the MSS at clause 21.05; and there is no other such reference, including within the Abbotsford Neighbourhood Area at clause 21.08. The use of the word "should" in strategy 17.2 provides an acknowledgement that there can be circumstances where new buildings may be permitted to exceed the 5-6 storey height preference. This is reinforced in the Landmarks and Tall Structures local planning policy at clause 22.03, which seeks (in part) to ensure the profile and silhouette of new tall structures add to the interest of Yarra's urban form and skyline. We concur with the Tribunal's findings in Design Consortia Australia[15]:
   1. In effect, while this urban design aesthetic of occasional high buildings amongst a base of low-rise buildings is not commonly promoted in other municipal policies, we believe that the key to its success is that, where it is applied, it should be applied fully and consistently. Where a strong contrast in building height may be fairly judged as discordant in one policy setting, it can be judged as appropriate in this setting. We do not accept that there is anything intrinsically wrong in having an occasionally dominant building.
2. In terms of "occasional high buildings", there is nothing in the local planning policies that provide any guidance as to how high is high and how building height should be determined. Strategy 17.2 provides a non-exhaustive list of 'benefits' that may justify a taller building:
   • Significant upper level setbacks
   • Architectural design excellence
   • Best practice environmental sustainability objectives in design and construction
   • High quality restoration and adaptive re-use of heritage buildings
   • Positive contribution to the enhancement of the public domain
   • Provision of affordable housing
3. Mr Gobbo stated these benefits sanction higher built form where these circumstances can be demonstrated. Some of these benefits have an obvious nexus with the appearance of a building, but others do not. This list is not exhaustive so there may be other benefits or criteria that would be relevant in particular circumstances. We acknowledge some of these benefits are achieved in this proposal, but none of them are a pre-condition to considering development above 5-6 storeys; and their achievement is not in itself sufficient reason to allow a taller building (to the exclusion of all other relevant planning considerations in a particular case). Any building still needs to be considered having regard to the physical and strategic context of the particular site.
4. Mr Gobbo's submission about the significant level of change and intensity of development encouraged for this neighbourhood activity centre focuses upon:
   • strategy 17.2;
   • the implementation strategy in the Abbotsford Neighbourhood Area to strengthen the consistency and character of the built form of land around Victoria Park Station[16]; and
   • the preferred built form character description for Main Roads in the Built Form Character Map for the Abbotsford Neighbourhood Area that states:
     • Maintain the hard urban edge of development along main roads.
     • Reflect the fine grain of the subdivision pattern in buildings where this exists along main roads.
5. We have discussed strategy 17.2 already and find there is nothing in the other two dot points above that indicate a significant or intensive change is sought to the existing character of Johnston Street neighbourhood activity centre.
6. Mr Biacsi referred to the Built Form and Design local planning policy and highlighted its general objectives at clause 22.10-2 include ensuring new development respects the scale and form of surrounding development "where this is a valued feature of the neighbourhood character". Mr Biacsi said height is not a valued feature of this neighbourhood having regard to the strategic context of this site. We have been unable to reach this conclusion given our earlier findings about the limited guidance in the planning policies about height other than strategy 17.2. It must be remembered this policy applies to all new development not included in a heritage overlay. Hence it is a broad policy that applies to land that is both inside and outside activity centres.
7. The design objective for building height in the policy is:

To ensure that the height of new development is appropriate to the context of the area (as identified in the Site Analysis Plan and Design Response) and respects the prevailing pattern of heights of the area where this is a positive contribution to neighbourhood character.

1. There are associated design guidelines including:

The maximum building height for the portion of the new development between the primary setback and the secondary setback should not exceed the height of the higher of the two adjacent buildings unless:

• The height is specified in any relevant policy or schedule set out under this Scheme.
• The development is in an area where it is appropriate and practicable to establish a distinctly different new character in order to achieve planning objectives.
• The adjacent buildings do not reflect the prevailing heights of the area.
• One of the adjacent buildings is considerably lower in height than the other and it is appropriate to step down to the lower building to create a suitable transition in building height.

New development that is higher than adjacent buildings should adopt a secondary setback for the higher building component which:

• Aligns to the street pattern;
• Retains existing view lines to nearby heritage places and other key features.

• Remain as roof space or be used as a roof top garden;
• Remain open to the sky; and
• Be free of ancillary services or major promotion signs.

The height of any portion of the new development which is located on the secondary setback should be guided by its visual impact and off-site amenity impacts on surrounding properties such as overshadowing, visual bulk, day lighting to habitable rooms and overlooking.

The overall height of new development (including the height between the primary setback and the secondary setback) may exceed the prevailing building height of the area if the site does not cause off-site impacts and is either:

• Located on a corner site of a main road; or
• Of substantial land area.

1. Mr Biacsi stated this proposal has no measurable off-site impacts and therefore is supported by this policy. However, Mr Biacsi acknowledged there are no measurable off-site impacts if a building on this site was 14-16 storeys or 11 storeys. Indeed, we find the same statement could also be made about a building that is 5-6 storeys. It must be remembered that the design objective is to ensure that the height is appropriate to the context of the area. Applying the guideline about off-site impacts means a variety of building heights could be appropriate on this site. Again, this is a broad policy that applies to all land in the municipality outside of a heritage overlay. There is nothing in this policy that leads us to conclude that the context of this area is encouraged to significantly or intensively change.

THE RELEVANCE OF OTHER VCAT AND SUPREME COURT OF VICTORIA DECISIONS

1. The Applicant's written submission included many references and quotes from various VCAT cases[17] in support of its arguments, and we have considered these[18]. The selective quoting from a large number of Tribunal decisions has been unhelpful as each case that comes before the Tribunal must be determined on the basis of the facts, circumstances and context of each of those sites and proposals. The Tribunal's findings in each of these cases varies because of the facts, circumstances and context of each of the sites and proposals. We have not found these cases to be persuasive with respect to why this proposal should be approved in this case. We provide the following examples as to why we have made this finding by referencing some of the quotes made in respect to the application of planning policy in this case:
   • In the Teac Australia[19] quote about dealing with policy, the Tribunal deferred making a decision on a series of buildings up to 18 storeys on the basis that a planning scheme amendment panel report was pending and the Application for Review was premature having regard to the state of urban design policy for the precinct. Hence the quote about it being relevant to consider the emerging character is in the context of a Tribunal's decision to actually defer its final decision until the strategic policy findings were known;
   • One of the Flemington Developments[20] quotes[21] relates to a 21 level building responding to the anticipated emerging character and being the first site to implement activity centre policy. What the decision also states is that the area will be in transition as a draft structure plan includes the subject land in a Major Activity Centre and identifies it as a major development site on which an iconic building of high architectural quality, 10 to 14 storeys in height is encouraged. Hence, the Tribunal's decision was influenced by these factors, which do not apply in this case; and
   • The Cremorne Corporation[22] quote regarding policy and height in Yarra and specifically how clauses 12 and 14 provide a strong and clear basis for development in an intensive way did not include the fact that the site formed part of a Major Activity Centre where intensive residential development is encouraged.
2. Overall, we have not placed much weight on these or the majority of the other cases referred to in the Applicant's submission. We have instead considered the merits of this proposal in light of its facts, circumstances and the context of this site and this proposal. There are, however, three cases that we wish to make specific mention of as significant weight was placed upon them during the hearing.

1. In his evidence in chief, Mr Milner stated he was briefed by the Applicant four days before the expert evidence was due to be submitted to provide "a strategic reality check". He said there were two matters that influenced his ability to give evidence in this case - the first was the Golden Ridge case (which we will deal with shortly) and the second was the Design Consortia Australia case at 4-16 Garfield Street Richmond. Mr Milner described the Design Consortia Australia case as "extraordinarily important in regard to policy interpretation". He referred to paragraphs 26-31 and specifically quoted paragraphs 28 and 29 in his expert report. We concur with the Tribunal's findings at paragraph 29[24] but find there are circumstances in that case that are different to this proposal:
   • The land was categorised as a strategic redevelopment site but was not included in an activity centre.
   • A permit had already issued following mediation at VCAT (and with the support of Council) for a 7 storey apartment complex[25], so the Tribunal was only considering the merits of increasing the height from 7 to 9 storeys.
   • As a permit had been granted, it was not open to the Tribunal to apply the local planning policies in a literal manner (namely for low rise development) as that would lead to lesser development than what had already been approved[26].
   • The question was therefore whether the additional two storeys to create 9 storeys was acceptable in a context that included a railway line, small scale office and industrial buildings to the west and north; industrial buildings converted to residential to the south; and single storey houses to the east.
   • The Tribunal found the additional two storeys would better fulfil Council's urban design policy of occasional high buildings amongst a base of low rise buildings as it considered the already approved 7 storeys to be neither high nor low rise.
2. In that case, the 'high' building amongst a low rise base was 9 storeys amongst generally single storey buildings. In this case, the 'high' building is 17 storeys and the low rise base is generally one to three storeys. Given all of these differences, we are not persuaded this decision is particularly helpful in determining the merits of this proposal.

The Mitcham Towers VCAT and Court of Appeal Decisions

1. It is the Applicant's case that the proper interpretation of activity centre policy in the context of substantial residential development arose in the Golden Ridge case[27]; and the Court of Appeal[28] decided the analysis of policy in that case disclosed no error of law. These decisions related to a proposal for a 14 storey predominantly residential development in the Mitcham neighbourhood activity centre.
2. Mr Milner relied upon the Golden Ridge case in his support for this proposal; Mr Biacsi was guided by it; and the Council officer report referred to it. Mr Gobbo's written submission quoted paragraphs 62-66 of the Golden Ridge case that discuss the characteristics of major and neighbourhood activity centres and observe that the hierarchy of activity centres is multi-purpose. Having read both of these decisions, we note the Court of Appeal acknowledged paragraphs 61-68 of the Tribunal's decision addressed the issue of activity centre hierarchy. The Court of Appeal decision quotes the Tribunal's conclusions in paragraphs 65 and 66:
   1. It is true that the classifications of activity centres provide guidance as to the appropriate form of development which should be permitted in the different types of centres. As a generality, it is true that large, high density developments will be more suited to activity centres towards the top of the hierarchy. But to treat the hierarchy as a definitive guide would be to ignore the purpose of the hierarchy. It would also overlook the difficulty of creating a universal hierarchy that was applicable for all situations.
   2. The hierarchy of activity centres in Melbourne 2030 is multi-purpose. It is designed to identify the scale and intensity of activity in a centre to inform policies concerning office development, conventional retailing, bulky goods retailing, entertainment facilities and high density residential development. But what we are concerned about in this case is confined to the suitability of Mitcham for a high density residential development. For reasons we have given the fundamentals strongly support this.
3. The Court of Appeal decision then states:
   1. This conclusion was further supported by an analysis of the major activity centres contained in the City of Whitehorse resulting in a finding that none of these are superior to Mitcham as a location for high density development. The complaint that the Tribunal misconstrued the meaning of 'higher density' is not persuasive.
4. We think the fact that none of the major activity centres in the City of Whitehorse were superior to Mitcham as a location for high density development formed part of the fundamentals referred to at the end of paragraph 66 of the Tribunal's decision[29]. These fundamentals are matters that we will comment on further shortly. Before doing so, we wish to highlight that there have been changes in the State planning policies[30] since the Court of Appeal decision in August 2005 and we have obviously considered the policies that are currently in the planning scheme as part of our consideration of the merits of this proposal in this neighbourhood activity centre.

The Fundamentals of Johnston Street Neighbourhood Activity Centre and Yarra's Major Activity Centres

1. This brings us back to an analysis of the fundamentals of Johnston Street neighbourhood activity centre and a comparative analysis with Yarra's major activity centres.
2. The Applicant acknowledged the legitimacy of considering that activity centre policy encourages higher order functions in higher order centres. Mr Biacsi acknowledged the classification of principal and major activity centres has been determined by State Government, whilst the classification of neighbourhood activity centres has been determined by local government through Municipal Strategic Statements and local planning policies in their respective planning schemes. As such, Mr Biacsi stated there are about 900 neighbourhood activity centres across metropolitan Melbourne. However, Mr Gobbo stated this should not overshadow the fact that State planning policies are about encouraging a concentration of activity in all activity centres. He highlighted there is particular emphasis in policy to encourage development in activity centres that are well served by public transport, particularly those centred on a railway station, as is the case here. Mr Biles and Mr Govenlock also highlighted the benefit of this site's proximity to a railway station and referred to clause 18.01 of the State planning policies that seeks to create a safe and sustainable transport system by integrating land use and transport planning. We note one of the related strategies is to concentrate key trip generators such as higher density residential development in and around a series of activity centres on the principal public transport network, but the hierarchy of activity centres listed does not include neighbourhood activity centres. Therefore, there is a distinction to be made between neighbourhood activity centres and major/principal activity centres centred around a railway station.

1. The nomination of the City of Yarra's major activity centres is generally not linked to the rail network or railway stations. We note Swan Street is centred around two railway stations, but the others are not. Rather, the other major activity centres are all generally served by tram services. The success of these centres as higher order centres appears to be achieved through characteristics including:
   • The wide range of retail services (including daily services such as full line supermarkets and specialty shops) evident in Victoria Street, Smith Street, Swan Street and Bridge Road;
   • The retail and entertainment tourism strength of Bridge Road and Brunswick Street; and
   • The increasing density of commercial, residential and retail activities in Victoria Street, including Victoria Gardens.
2. We find the level of services, the particular strengths and the density of activity are not characteristics that can be generally applied to the physical context of Johnston Street neighbourhood activity centre[31].

1. As we have already stated, Johnston Street is a collection of industrial and commercial businesses, retail shop fronts, some of which are vacant, and residential houses. There are large scale offices near the corner of Johnston Street and Trenerry Crescent. There is also a small supermarket, a petrol station and a café on the opposite side of Johnston Street, and a restaurant to the east of this site[32]. Mr Hunt conceded the lack of daily conveniences will mean some increase in the need for the residents of this proposal to use cars. Hence, this site is not within an activity centre that has easy walking distance to the conveniences of daily living normally associated with vibrant activity centres, such as Yarra's major activity centres.
2. The Applicant placed emphasis upon the following passage from Golden Ridge where it found the proposed development should be considered based on the fundamentals of the activity centre rather than its classification:
   1. ... it is that higher density residential development should be encouraged in locations where residents can walk to a place of employment, a supermarket, a chemist, a video shop, a bank, a restaurant, a library, a doctor, a hairdresser and a place to get a good cup of coffee. By increasing the number of walking trips, the economic and environmental load on our roads will be reduced; and socialisation opportunities will increase. These objectives will be underscored if the activity centre is well served by public transport.
3. In Golden Ridge, it was found that Mitcham is "a vibrant centre" with a significant railway station providing an excellent service to the city. We are not persuaded the same can be said about Johnston Street; and we are not persuaded Johnston Street provides anywhere near the same level of service as that described in the above quote. We are also not persuaded that Johnston Street is equal to or superior to any of Yarra's major activity centres in terms of its fundamentals. Even in comparison to other neighbourhood activity centres such as Queens Parade Clifton Hill that contains a range of retail and commercial businesses that collectively create a thriving centre, we find Johnston Street is a low level neighbourhood activity centre.

17 Storeys in an Inner Neighbourhood Activity Centre

1. Mr Biles expressed the view that if this was a neighbourhood activity centre in Narre Warren you would not consider 17 storeys; but this is a neighbourhood activity centre in inner Melbourne so the building form needs to respond to that context. The State planning policies are not structured in this way. A neighbourhood activity centre is just that irrespective of its location in inner or outer Melbourne. In any case, higher density housing in a neighbourhood activity centre must respond to its particular context. We are not persuaded 17 storeys fits the context of this site or enhances the character of this area.

1. The combination of strategy 17.2 and the built form local planning policy clearly open the door to consideration of a building on this site that exceeds the preferred height of 5-6 storeys. The Council stated since the local planning policies were written, the tallest buildings approved in the municipality are 11 storeys including within its major activity centres. Mr Wren stated these developments have been regarded as substantial developments that are compliant with the planning scheme. Hence, the Council's concern in this case is that the proposed building is simply too high. We do not think a comparison of this proposal with the height of other buildings in the municipality is helpful as each case must be considered on its individual merits. For the reasons we have explained, we are not persuaded 17 storeys is an acceptable outcome on this site.
2. In our opinion, the applicable State and local planning policies do not contain a sufficient degree of detail and clarity (as suggested by the Applicant) to enable us to form the view that a 17 storey building on this site is consistent with the outcomes sought to be achieved for this neighbourhood activity centre. As higher density housing in neighbourhood activity centres is encouraged to fit the context and enhance the character of the area, we have come to the conclusion that the proposed building height does not respond in an acceptable manner to its local context.
3. We reiterate that we are persuaded by the evidence and submissions presented by the Council and the Applicant that this site is suitable for consideration of a building that is, or exceeds, 5-6 storeys in height. In our opinion, a building of 11, 14-16 or 17 storeys on this site is an intense or significant change in a neighbourhood activity centre that is predominantly one to three storeys. We are not persuaded the State or local planning policies in the planning scheme clearly identify this neighbourhood activity centre as an area in which intense or significant change is contemplated or encouraged.
4. The major activity centres in this municipality are superior to this neighbourhood activity centre and therefore we find the characteristics (or fundamentals) of Johnston Street neighbourhood activity centre do not make it an area in which intense or significant change is appropriate.
5. For these reasons, we have decided to affirm the Council's decision and order that no permit be issued.

[1] The hearing of this case took place over 5 days with many submissions and the presentation of expert evidence by six witnesses. We have considered all the submissions and evidence presented although we have not recited all of the contents in these reasons.

[2] Such as the loading arrangements for the residential apartments; the appropriateness of the townhouse in Stafford Street surrounded on two sides by access ways; the provision of storage for the apartments; how much car parking should be provided; and whether the number of commercial car parking spaces should be increased.

[3] During the hearing, the focus was on the section of Johnston Street between Hoddle Street and the Yarra River, but it is arguable that the strategic framework plan nominates the extent of the Johnston Street neighbourhood activity centre as extending at least to the first intersecting Major Activity Centre (Smith Street) or even further west to Nicholson Street.

[4] Referring to clause 55 of the planning scheme.

[5] Commissioned by the City of Melbourne and the Victorian Department of Transport to establish the potential to transform metropolitan Melbourne to meet the projected population of 5 million by 2029 on land other than activity centres and rail based public transport.

[7] The Applicant's expert witness called to give both urban design and planning evidence.

[8] Mr Hutson explained the proposal is 53 metres in height with maximum setbacks of 7.1-8.0 metres at the upper levels. Using these setbacks and a 1:1 ratio creates the opportunity for an 11 storey building if similar setbacks are incorporated into any new building on the opposite side of Johnston Street.

[9] Having regard to Melbourne 2030 and Melbourne @ 5 Million.

[10] Released by the Property Council of Australia. It must be noted that this document is not Government policy, nor is it a reference or incorporated document in the planning scheme, therefore we find limited weight should be given to it.

[12] All of whom responded to a question in cross-examination by the Council that the development opportunity afforded by this site is not be gained at all costs.

[13] Common Equity Housing Pty Ltd v Yarra City Council and Ors [2009] VCAT 1722.

[14] Mr Gobbo referred to Flemington Developments Pty Ltd v Moonee Valley CC [2010] VCAT 1760 at paragraphs 24 and 25 for a discussion on policy and why strategic redevelopment sites are appropriate for this form of housing. We note this decision refers to planning policy to locate more intense housing development in and around activity centres, in areas close to train stations and on large redevelopment sites. However, this decision predated Amendment VC75 so this planning policy is no longer contained in clause 16.01-2.

[15] Design Consortia Australia v Yarra CC [2009] VCAT 2573.

[16] Mr Gobbo's submission also refers to the Neighbourhood Map at Figure 5, but we have not referred to this as the figure contains a note that it is indicative only. In any event we find there is nothing in this map that is helpful in considering the issue of building height in this case.

[17] Insite Architects v Banyule CC [2011] VCAT 152; QPF Developments Pty Ltd v Yarra CC & Ors [2011] VCAT 1572; Design Consortia Australia v Yarra CC [2009] VCAT 2573; Flemington Developments Pty Ltd v Moonee Valley CC [2010] VCAT 1760; Cadden v Stonnington [2011] VCAT 916; Investa Properties Ltd v Yarra CC [2007] VCAT 703; Teac Australia Pty Ltd v Port Phillip CC [1999] VCAT 1222; SMA Projects v Port Phillip CC [1999] VCAT 1312; Cremorne Corporation Pty Ltd v Yarra CC [2008] VCAT 1202; Golden Ridge Investments Pty Ltd v Whitehorse CC [2004] VCAT 1706; Peter Gibson Developments Pty Ltd v Stonnington CC [2011] VCAT 1007; Westfield Ltd v Manningham CC & Ors [2010] VCAT 980; Rowcliffe v Stonnington CC [2004] VCAT 26; CK Designworks v Melbourne CC [2011] VCAT 584; Melbourne CC v Minister for Planning [2010] VCAT 1459; Stockland Development PL v Stonnington CC [2010] VCAT 1849 (No. 2); Bensons Property Group v Moonee Valley CC [2008] VCAT 1678; 35 Albert Road Pty Ltd v Port Phillip CC [2011] VCAT 1379; Daniel Stevens (Zero Nine Pty Ltd) v Yarra CC [2011] VCAT 467; Carlos Constructions v Moreland CC (Red Dot) [2005] VCAT 2718; First State Constructions (Vic) Pty Ltd v Boroondara CC [2005] VCAT 1611; Rare City Acre Pty Ltd v Yarra CC [2008] VCAT 2100; The Capitol (Vic) Pty Ltd v Stonnington CC & Ors [2009] VCAT 1227.

[18] We were not provided with full copies of these cases during the hearing (only extracts) and have subsequently reviewed their full content.

[19] Teac Australia Pty Ltd v Port Phillip CC [1999] VCAT 1222.

[20] Flemington Developments Pty Ltd v Moonee Valley CC [2010] VCAT 1760.

[21] The quotes on page 25 of Mr Gobbo's written submission.

[22] Cremorne Corporation Pty Ltd v Yarra CC [2008] VCAT 1202.

[23] Design Consortia Australia v Yarra CC [2009] VCAT 2573.

[24] As we have already quoted this paragraph in these reasons for our decision.

[25] This means the planning merits of this proposal were not considered by the Tribunal at that time.

[26] These are generally the Tribunal's words from paragraph 22 of the decision.

[27] Golden Ridge Investments Pty Ltd v Whitehorse CC [2004] VCAT 1706.

[28] Whitehorse CC v Golden Ridge Investments Pty Ltd [2005] VSCA 198.

[29] Which is where Mr Gobbo's quote ended in his written submission.

[30] Such as Amendment VC34 in September 2005 that introduced Melbourne 2030 strategies as State policy; Amendment VC71 in September 2010 that updated Melbourne's growth and housing policies; and Amendment VC75 in December 2010 that removed reference to locating more intense housing development in and around activity centres, in areas close to train stations and on large redevelopment sites from the housing policies.

[31] Other than the density of primarily residential and office development focussed around the corner of Johnston Street and Trenerry Crescent.

[32] Just focussing on some of the uses immediately surrounding this site.