Alexus Pty Limited v Leichhardt Council

APPLICANT Mr M Frazer (barrister) SOLICITOR Craddock Murray Neumann Lawyers LEGAL REPRESENTATIVES:

RESPONDENT Ms R McCulloch (solicitor) SOLICITOR Pikes Lawyers

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

10939 of 2009 Alexus Pty Limited v Leichhardt Council

JUDGMENT Background. 1 This appeal was lodged against council's deemed refusal of a development application for the conversion of part of a 4 level mixed-use development located at 91 - 95 Victoria Road, Rozelle. The proposal involves the reduction in the ground floor business area and conversion of the existing garage/parking areas associated with the business area into 3 residential units. 2 The existing building was originally approved in or about 2000 in the following configuration: o Commercial/business floor area of approximately 487 sq m at ground level (Victoria Road); o An intermediate level (Level 1) providing parking for the business floor area on the western side (the area currently occupied by and under lease to the ground floor tenant). This has ground level access from Prosper Lane; o 5 residential units at levels 2 and 3, with pedestrian access from Prosper Lane; 3 This consent was subsequently modified by the Court in consent orders made in 2007, which allowed the conversion of the eastern part of the car park area into 3 residential units. However this was subsequently amended to 2 units that have now been constructed. Consequently there is no car parking for either the pre-existing residential units or the new units. The modified conditions included: Condition 27: Application for a subdivision certificate under Section 109(C) (1) (d) of the Environmental Planning and Assessment Act 1979 shall be made to Council and be approved and registered prior to occupation. In so doing the associated strata plan and by laws shall be amended to reflect the following: i Parking space 4 to be denoted on the strata plan as being a loading dock for Pt Lot 12. ii The visitor parking spaces to be allocated to PT Lot 12 (the commercial tenancy); iii No owners, tenants or occupiers of this building are eligible to participate in any existing or proposed Council Parking Schemes. All occupants and/or employees of this building will be ineligible to obtain any Council Parking Scheme permits. 4 The contentions raised by council for this current application are then summarised as: o Overdevelopment of the site; o Parking impacts; o Suitability of the proposed revised parking loading arrangements for the ground floor commercial/business tenancy; o SEPP 1 Objection to the FSR development standard. o Internal amenity of the proposed residential units. o Disabled access provisions.

The site 5 This site is described as Lot 1 in DP 31516 & Lot 8 in DP 443922. It has a total area of 529 sq m and is basically rectangular in shape with 3 street frontages to Victoria Road to the south of 30.48m, Prosper Street to the east (12.905m) and Prosper Lane to the north (33.48m). There is a fall of approximately 3.5m from the north to south across the site, so that Prosper Lane is the equivalent of approximately 1 - storey above the level of Victoria Road. 6 The subject premises comprise a commercial and residential mixed use building which occupies most of the existing lot: * The lowest 1st level, facing Victoria Road, is occupied by a tenant (currently telecommunication and IT sales); * The next 2nd level up, (this being basically level with Prosper Lane) is occupied by 2 x 2 bedroom residential units on the eastern side and the car parking area on the western side. This parking area forms part of the area leased to the ground floor tenant and is the area now proposed for the 3 additional residential units; * The 3rd and 4th floors comprise 5 residential units, each over 2 floors. The units are located towards the southern side of the site, each with a large deck over the podium below. The units are configured as 3 x 2 bedroom units and 2 x 1 bedroom units. Further to earlier modifications to the original consent, no parking spaces are allocated to any of these units. No works are proposed to any of these units. 7 Under the development consent which the 2 units on the 1st floor level were approved, none of the existing units (either those 2 units, or the 5 units above) are entitled to apply for resident parking permits.

The proposal 8 This proposal is for the reduction and reconfiguration of the ground floor commercial area to incorporate the parking areas transferred from the 1st level. The original parking area at the 1st level is to be "fitted out" for 2 x 2 bedroom units and 1 x 1 unit. It currently contains: - 8 car parking spaces; - Main vehicular driveway entrance from Prosper Lane; - 1 loading bay; - An enclosed lift motor room and lift; 9 The reconfiguration of the ground floor premises involves: - reduce the area of commercial floor space from approximately 487 square metres to 260 square metres; - construct a new single width driveway from Prosper Street; - form a new basement car park providing a total of 5 parking spaces, comprising 4 car spaces in a car stacker (2 x 2 configuration) and one car space at grade; - the incorporation of a vehicle turntable to facilitate manoeuvring within the new car parking area; - allocating an area for `loading' which forms part of the driveway access to the at grade car parking space; - providing storage for 5 bins for use for the commercial floor space. 10 The proposed 3 new units are to be arranged in a north - south configuration as follows: - Unit C will have 2 bedrooms on the southern side, a living room on the northern side and kitchen and bathroom between. The total area of this unit is 72 square metres'. It will have a balcony of 8 square metres, however most of this balcony will be located under the slope of the underside of stairs leading to the upper level; - Unit D will have 1 bedroom and a bathroom on the southern side, a living room on the northern side and kitchen between. The total area of this unit is 57 square metres. It will have a balcony of 9.4 square metres; - Unit E will have 2 bedrooms on the southern side, a living room on the northern side and kitchen and bathroom between. The total area of this unit is 72 square metres. It will have a balcony of 12 square metres; 11 No parking is proposed for any of the units. One parking space approved under a previous development application for an existing residential unit (but not implemented due to the lease conditions for the ground floor commercial tenant) will be removed. Planning controls 12 The primary planning control is the Leichhardt LEP 2000, under which the site is within the Business Zone. The business zone applies to land within existing business centres where retail, commercial and associated uses are concentrated.

13 The LEP lists a number of general objectives, which are then subject to more specific detailed objectives. The overall vision of the LEP is: "to conserve and enhance the quality and diversity (social and physical) of the natural, living and leisure environments of the local government area of Leichhardt. The protection of the amenity of residents should be pre - eminent." 14 The Housing objectives are contained in cl 17 and relevantly include: (a) to provide development standards to ensure that the density and landscaped areas of new housing are complimentary to and compatible with the style, orientation and pattern of surrounding buildings, works and landscaping and take into account the suite of controls in Leichhardt Development Control Plan 2000 to achieve the desired future character… 15 The Employment objectives are contained in cl 20 and include: (a) to ensure the sustainable growth of Leichhardt's economy by retaining existing employment uses and fostering a range of new industrial and business uses to meet the needs of the community, (c) to integrate residential and business development in business centres (d) to ensure that buildings to be used for employment are appropriately located and designed to minimise the generation of noise, traffic, car parking, waste, pollution and other adverse impacts, to maintain the amenity of surrounding land uses, an avoid harm to the environment. … 16 Clause 19 (6) provides that consent must not be granted for development that comprises 4 or more dwellings unless a minimum of 25% of units are one-bedroom or bedsitter units, and not more than 30% of units may be three bedroom. Clause 19 (7) provides that consent shall not be granted to development providing 10 or more units unless (as relevant for development of 10 -- 15 units) one adaptable unit is provided. 17 Clause 23 (1) provides that the maximum floor space ratio (FSR) is to be 1.5:1 for mixed use (residential and other) development, providing that all floor space at ground level or street level is used for non-residential purposes (except for any floor space useful service and access purposes required for the residential component of the building in the floors above). 18 The associated development controls are contained in DCP 2000. Relevantly they deal with amenity, parking standards/manoeuvring and controls for the Rozelle commercial neighbourhood. 19 Section A8 of the DCP contains the parking standards based on the following principles: - To ensure that safe and sufficient parking for all modes of transport is provided to meet anticipated demands. - To improve access by walking, cycling and public transport to housing, jobs and services. - Ensure access for people with disabilities. - Increase the choice of available transport and reducing dependence on cars. - To make cycling a viable transport alternative. - To restrain employee off-street parking provisions to discourage car travel. - To improve the design and quality of the urban environment. 20 Accordingly generic parking rates are stated and are discussed later. 21 Part B4.6 of the DCP deals with residential development in business areas and includes a control that 'no car parking is to be provided'. The evidence 22 Detailed evidence was presented by: - Ms D Laidlaw; consulting planner for council, - Mr L Fletcher; consulting planner for applicant. - Mr J Coady; traffic consultant for council. - A number of residents presented oral evidence that has been considered with the written objections.

23 During the course of the appeal, the applicant offered a number of detailing amendments in response to the issues. This includes the applicant's willingness to accept a condition to convert the proposed Unit E (middle unit) to an adaptable unit satisfy cl 19 (7) and avoid the necessity to determine a SEPP 1 Objection this development standard. 24 Consequently, the main outstanding issues concern: - Whether a SEPP 1 Objection to the FSR development standard should be allowed. - Adequacy of parking and any resultant amenity impacts. - Internal amenity of the units.

SEPP 1 Objection 25 The SEPP1 objection is to the development standard in cl 23(1) of the LEP, which limits the FSR in the Business zone to 1.5:1, on the basis that all floor space at the ground or street level is used for non-residential purposes except for any floor space used for services and access. 26 According to the SEPP 1, the site has an area of 529 sq m and the floor area is 1092.5 sq m, giving a FSR of 2.07:1. This is on the basis that the first floor level is partially open to facilitate its use as the car park. However, as the proposal involves the enclosure of this area, the calculated FSR increases to 2.48:1. 27 As cl 23 does not state the objective of this standard, it is assumed to be: - To control the bulk of buildings and attendant impacts including shadowing, view loss etc; and - To control the intensity of land use which includes the sum of the impacts of the development on the external environment including traffic generation, parking, loading and associated vehicular access movements. 28 Accordingly, the SEPP 1 says that the technical increase in the FSR arises from the conversion of the partially open car parking and this in - filling will not alter the height, bulk or visible volume of the existing building. Consequently the 1st assumed objective is satisfied. Ms Laidlaw also conceded that this assumed objective is reasonably satisfied. 29 In regard to the intensity of use objective, the SEPP 1 addresses this by reference to both the parking requirement for the development and its traffic generation. According to the SEPP 1, the proposed reduction in the commercial area at Victoria Road ground level, allows a corresponding reduction in car parking from 8 spaces to a complying 5 spaces resulting in: - The provision of 3 additional 1 or 2 bedroom units, - Reduction in the commercial floor space by 183.3 sq m, - Applying the RTA guide for traffic generation figures, this results in: * Additional 12 to 15 daily vehicle trips, * Including 1.2 to 1.5 peak hour vehicle trips. - This is more than offset by the reduction in trips generated by reduction in commercial floor space. - Overall there should be a reduction in the intensity of use measured by traffic generation of approximately 3 daily vehicle trips (DVT) including 2 peak hour vehicle trips (PVT). 30 The other traffic consideration concerns the loading arrangements. The SEPP 1 states that the DCP is ambiguous in terms of the need for a loading bay. However the guidelines in Section C1.2 refer to avoiding on-street loading and unloading where possible. By reference then to the RTA guidelines for commercial premises, it suggests the provision of 1 loading bay for each 4000 sq m of commercial space. Application of these guidelines would then require 0.08 loading bays. 31 Consequently the SEPP 1 concludes that the assumed objectives are satisfied and therefore the objection is well - foundered. Furthermore, compliance with this standard is unnecessary and unreasonable because it satisfies the objectives and achieves other desirable planning outcomes. They include the provision of additional housing in a location close to transport and other facilities, as well as the improved appearance of the development from the public domain. As the proposal does not involve any significant changes to the existing building, then it will not alter the built form context of the locality. 32 The other identified issues involving the FSR, the built form, parking/ traffic impacts and amenity were addressed in the joint expert conferencing. I have therefore considered the respective opinions on the merits of these issues in the determination of the SEPP 1.

Traffic/parking 33 Mr Coady and Mr Fletcher assessed this issue. They agree that the use of the existing area marked "LOADING" on the carpark level for loading is impractical. Accordingly Mr Fletcher states that there is no proposal for on-site loading and unloading, but there will be 5 off-street car spaces (4 spaces in the mechanical stacker plus 1 at grade to service the commercial area. 34 The conclusion of these experts from the joint conferencing is that the provision of the 5 relocated car spaces satisfies the minimum parking provisions of the LEP and that the use of a car stacker, a turntable, or a combination of both is a feasible arrangement. Also, that the DCP in Ch. B4.6 - Residential Development in Business Areas stipulates that "no carparking should be provided" for the residential component of mixed - use development in the business areas, as in the current case. 35 However Mr Coady expresses concerns about the likely parking outcome by reference to the alternate RTA guidelines, which indicates that 8 spaces should be provided for the 302.8 sq m commercial floor area. Then if consideration is given to the 2006 Census, it is apparent that the typical parking demand for households in residential flat buildings in Leichhardt LGA would result in the demand for a further 8.8 spaces. When an additional space for visitor parking is added, as required by Ch A8.0 of the DCP, the likely parking demand is 18 spaces. 36 As the proposal is only to incorporate 5 off-street spaces, this shortfall of 13 spaces will need to be accommodated on-street in the vicinity of the site. He expresses further concerns about the lack of on-site loading facilities, saying that these factors will likely exacerbate the competition for the limited on-street parking spaces. 37 Insofar as neither consultant undertook any parking surveys, Mr Coady's opinion is that the excess parking demand of 13 vehicles will need to be accommodated on - street and due to the existing heavy parking demand, there will likely be a significant adverse effect on the amenity of the area, to such an extent as to warrant refusal of the application. 38 Against this, Mr Fletcher says that the RTA guidelines are not an appropriate document in this case. Instead it is a reference document to assist councils in the formulation of their car parking DCPs. There would have been an awareness of these guidelines in formulating the adopted controls that now deliberately do not require parking spaces for new dwellings in this area. He says the reasons for this are: - To increase the choice of available transport and reducing dependence on cars. - To make cycling a viable transport alternative. - To restrain employee off-street parking provisions to discourage car travel. 39 In response to the limited on-street parking spaces, Mr Fletcher says that if the access way to the existing carpark is removed, then subject to the Local Traffic Committee, the section of Prosper Lane along the rear of the site can be changed from 2 - way traffic to 1- way westbound. This would enable the creation of an additional 4 on - street car spaces in this section of Prosper Lane. 40 However Mr Coady does not consider this practical or desirable because: - There is insufficient width within the road reserve to accommodate both parking and a safe footpath on the southern side. - It is not practical to use the northern side of this section of Prosper Lane for parking because its footpath is too narrow. If it was contemplated, it would likely shift traffic movements closer to the front entrances, patios of the new units

Internal amenity impacts 41 Ms Laidlaw initially said that none of the new units receives a minimum of 3 hours solar access in accordance the provisions of B1.3 of DCP 2000. However one of the amendments presented by the applicant is to adjust the north facing patio roof form to increase solar access. 42 The planners also fundamentally disagreed on the application of Part A8 and Part B4.6 of the DCP. Part A8 deals with parking standards and controls. For residential land uses, the generic guidelines are: - 1BR unit; 0.5 spaces/unit (minimum) & 1 space (maximum), - 2BR unit; 0.8 spaces/unit (minimum) & 1.6 spaces (maximum). - Visitor spaces @ a minimum/maximum of 0.1 spaces/0.2 spaces per unit for visitors. 43 Part B4.6 deals with residential development in business areas in accordance with the principle to enhance the vitality and safety of business areas by increasing residential activity. It recognises that the resultant amenity may differ from that applying to predominant residential precinct. The controls include: - Innovative design solutions such as central light wells / atria and articulated facades should be incorporated to maximise solar access. - No car parking should be provided. 44 However other parking layout and servicing controls are contained in Part C1.2. The relevant principles state: - Where on-site car parking or service areas required, ensure that the layout does not detract from the amenity of adjoining areas. - Ensure the design of parking and servicing areas is efficient, safe, convenient, discrete and suitably landscaped. - Minimise nuisance caused by traffic movement, generation and servicing. 45 The associated controls provide: - Provide sufficient and convenient parking to satisfy the potential demand generated by the development, and avoid spill - over parking onto public streets. - Where non - residential development is within or adjoining a residential zone, locate and design parking areas, servicing areas and the means of access/egress to: o minimise conflict between non - residential and pedestrian traffic; o provide off-street parking and servicing of premises; o respect the character of the existing areas and streetscape by means of siting, design and landscaping; * mechanically assisted parking facilities should not be provided. 46 Insofar as the planning and traffic experts assessed these controls and maintain their opposing opinions, I have also taken into account the evidence of the neighbours and objectors, so as to objectively assess the likely impacts on the residential amenity of the area. It seems to me that this is an important consideration by reference to the primary vision of the LEP, where the "protection of the amenity of the residents should be pre - eminent". 47 The objectors raised common concerns about the high level of competition for the limited existing on - street parking spaces. Also concerns were expressed about the current traffic difficulties in accessing Prosper Lane due to illegal parking and associated safety risks for this apparently well-used pedestrian thoroughfare. 48 Evidence was also presented by the current lessee of the commercial premises. He is apparently satisfied with the existing commercial configuration and is most likely to exercise his option to renew the lease until 2016. It seems the provision of adequate car parking is an important consideration in the viability of his operations. 49 There is currently about 15 staff who fully use the car park, together with some customers. He said that when customers are unable to use the car park, there is difficulty in obtaining on - street parking. He does not consider the proposed car park with car stacker and turntable convenient or suitable for his business.

Conclusions 50 The threshold issue in this matter concerns the SEPP 1 Objection to the FSR development standard. In this case, the subject development is from a relatively recent consent, being granted in 2000 for an area of commercial space/associated car parking and 5 residential units in the Business zone. This consent was subsequently modified by the conversion of part of the 1st level car park into 2 more residential units and allowed an exceedence of the FSR development standard. 51 The current application is for the further conversion of the remaining 1st floor car park area into an additional 3 residential units, together with a reduction in the commercial area and incorporation of a new ground level car park. 52 The existing consent allowed a non -complying FSR in the order of 2.07:1. This is on the basis that the 1st floor level is predominantly open and therefore its floor area is not included. However the proposal involves the enclosure of this car park area, which then increases the FSR calculation to 2.48:1 (according to the control definitions). This represents an exceedence of the FSR over the 1.5:1 development standard of approximately 65%. 53 In determining the SEPP 1, I rely on the 2 assumed objectives agreed by the planners. The 1st assumed objective of this development standard is to limit the overall bulk of the building. In the current matter, I accept that the building bulk will not change from that originally approved by council. Therefore I agree with the planners that the application should not be rejected on these grounds. 54 The more critical objective is to ensure that the intensity of any development protects the amenity of the residents. It is apparent from the view that the site fronting Victoria Road is also located adjacent to residential dwellings, many of which do not have off - street parking. I therefore accept the parking issue is a key element in the assessment of the amenity of this area. Furthermore, that competition fro the limited parking spaces is high in the current circumstances. 55 Insofar as the applicant relies heavily on council's controls that do not allow on - site parking in new residential developments in the Business zone, it seems to me that the FSR control limits the total floor space and the effective balance between the commercial space and other components, such as residential. This balance is to enable the economic and orderly development to ensure there is a desirable level of residential amenity achieved. 56 The current (non-complying FSR) development includes 8 car spaces and loading bay for the existing, larger commercial area, which is apparently fully utilised by the lessee. Notwithstanding this, he says that there is still further demand for parking associated with the commercial premises and this occasionally results in the use of on - street spaces by commercial users. 57 Taking into account the parking constraints in this neighbourhood and its proximity to the busy Victoria Road, it is apparent to me that the amount of on - site parking provided and its convenience of use is likely to influence the amenity for residents. 58 Accordingly, the intensity of use of this site directly affects the amenity of the residents. As the site is in the business zone, it seems to me that its primary purpose is to enable the economic and orderly development of business and commercial uses that are restricted in the adjacent residential zones. Such development is to provide adequate parking in accordance with the DCP. 59 As a consequence of this primary use, other secondary uses such as residential are permitted in this zone and they are not required to provide on - site parking. However the intensity of such development is controlled by the FSR development standard, to which this proposal is significantly non - compliant. 60 The approval of the current application, which further exceeds the FSR will likely add additional vehicles to the street parking demand as indicated by Mr Coady. This outcome is confirmed because it appears that the residents of the other units have requested and been been granted parking permits despite a covenant on the units that they are not entitled to such permits. Whilst this is unfortunate, it at least confirms that the residents of these types of units will likely have vehicles. I am therefore satisfied that the allowance of the additional floor space for the units will most likely increase demand for the on -street spaces and accordingly reduce the amenity of the residents. 61 It also seems to me from the evidence that the new proposed basement car park will have reduced amenity and attractiveness for use, despite being numerically compliant for the reduced commercial area. This reduced amenity arises from the following factors: - Its entry from Prosper Street is via a 7% gradient and is in close proximity to Victoria Road, which is subject to more traffic flows than the existing entry in Prosper Lane - No convenient loading arrangements are provided; - This car park includes 2 - car stackers and 1 parking space at grade; - It also relies on a turntable to manoeuvre vehicles to allow entry in a forward direction. 62 Consequently, I am satisfied to rely on the opinion of Mr Coady that these factors are likely to deter some users from this form of car parking, which is then likely to further exacerbate on - street parking competition. In this regard, I think that some weight should be given to Mr Coady's opinion that 'not providing residential car parking has less impact upon car use than not providing business parking'. 63 Insofar as there was some discussion about revised traffic arrangements in Prosper Lane to change the 2 - way traffic flows to possibly allow parking on one side to accommodate some of the 13 space deficiency identified by Mr Coady, this was speculative and no compelling evidence was presented regarding the local traffic committee's attitude to these changes. I therefore give these submissions about additional street parking little weight. 64 A key element in the applicant's submissions is that Part B4.6 of the DCP ('no car parking should be provided') acts in priority over the generic car parking requirements in A8.0. However I do not consider this merit assessment is determinative unless the SEPP 1 is allowed. 65 In summary then, I am satisfied that the outcome from allowing this development would be to decrease the commercial area and increase the residential area, which would likely increase parking demands and therefore reduce the amenity of the residents. This outcome is also likely to be compounded by the introduction of a less attractive commercial parking area. Therefore I do not consider this proposed level of intensification satisfies the assumed objective of the development standard. 66 Even though the SEPP 1 states that there are significant benefits in allowing additional affordable housing in circumstances as proposed, I think these objectives should be given less weight when determining the SEPP 1 objection. This type of development can be incorporated into a complying development whereby the primary vision of the LEP 'to protect the amenity of residents is pre - eminent'. 67 By reference to the tests in Winten Property Group v North Sydney Council [2001] NSWLEC 46, it seems to me that the satisfaction of the 4th test regarding whether compliance with the development standard is unreasonable or unnecessary also requires consideration of whether a complying development is unnecessary or unreasonable. In the current matter, I am satisfied that compliance with the development standard would likely achieve the assumed objective. In the ultimate, I do not consider the SEPP 1 Objection demonstrates that compliance with the FSR development standard is unnecessary or unreasonable. 68 Apart from the SEPP 1 issue, the other substantive issue concerns the amenity of the new units. I accept that the amendments undertaken during the hearing would improve the solar access and internal amenity of these units, particularly C and E. But in my assessment, the internal Unit D still has poor amenity due to its small courtyard and solar access, however this is not determinative because of the failure of the SEPP1.

Court orders 69 The Court orders 1. The appeal is dismissed 2. The SEPP 1 Objection to the FSR development standard in clause 23 (1) of the LEP is disallowed. 3. Development consent for DA /2009/400 for the conversion of commercial car parking area to create 3 residential units and reconfigure the ground floor commercial area at 91 - 95 Victoria Road, Rozelle is refused. 4 The exhibits may be returned except 1, 2 and 3.

      R Hussey
      Commissioner of the Court
      ljr

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