This submission was supported by an argument that an analysis of the amount of retail space in the Hawkesbury area demonstrated that the amount of retail space per capita can be directly related to competitive pricing: the greater the amount of supermarket floor space, the lower the prices.

The applicant also supported its submission that the subject site was suitable for this purpose by referring to alternative sites which had been identified by the respondent as potential sites for retail expansion (and which had been zoned accordingly) as being unsuitable for a supermarket development of the kind now sought. The reasons given as to why the alternative sites were unsuitable were: small size, poor street exposure, multiplicity of ownership and, in some instances, re-zoning, heritage constraints, excessive building costs or, in the case of one site within the Windsor town centre known as Holland Park, a car parking area which would be flood prone. In other words, the applicant relied upon these reasons in asserting that a supermarket of the size proposed could not be located within the Windsor town centre or on any other appropriately zoned land.

The respondent disputed these claims, asserting that with existing and currently approved development there would be sufficient floor space to provide a competitive retailing environment in Hawkesbury. Developments approved or under construction include a new discount department store development to be called "The Market Place" at Richmond (which includes a Woolworths supermarket of about 4,000 sq m) and approved extensions to other existing supermarket space in Richmond. Moreover, a supermarket at North Richmond had been granted a consent for extensions of about 1,200 sq m. Richmond is between five and six kilometres from Windsor - about a six or seven minute drive. It is therefore easily accessible to those within the Hawkesbury local government area.

According to Mr P D Leyshon, a retail analyst called by the respondent, the amount of retail space available in the Hawkesbury area presently existing, under construction or approved, would be about 0.32 sq m per capita, compared to 0.21 sq m in 1991-92. This figure compares favourably with the New South Wales average of 0.27 sq m per capita and an average for Newcastle (New South Wales' best provided and most competitive retail locality) of 0.30 sq m per capita. While New South Wales was said to have a rate per capita lower than the national average, Mr Leyshon expressed the opinion that the Hawkesbury trade area would nevertheless have an adequate supply of supermarket space compared to contemporary standards.

Mr A D Dimasi, a retail economist called by the applicant, produced slightly different figures; the amount of retail space in Hawkesbury, both existing and currently approved, was 0.257 sq m per capita and, if the present proposal was to be included, it would be 0.340 sq m per capita. This compares with a national average of 0.312 sq m per capita. Accordingly, there was capacity within the Hawkesbury area for the additional supermarket now proposed.

Mr M Hill, a land economist called by the applicant, had examined the financial feasibility (in development rather than operational terms) of establishing another 'stand alone' supermarket, of the scale and type proposed here, at three potential sites in the Windsor town centre and at the South Windsor commercial centre. He concluded that none of the sites which he assessed, including the Holland Park site, were feasible as development projects. He noted here that developer/operators such as Woolworths may view the development risks differently from developers because such operators derive longer term benefits as occupiers. Mr Hill had not carried out a development feasibility on the subject site. He nevertheless conceded under cross-examination that according to the standard construction cost range for a supermarket of the proposed size, provided by Woolworths, the potential construction cost for a development of the same type of supermarket at Holland Park would be about $1 million less than the construction costs for the subject site ($7-7.25 million at Holland Park and $8-$8.25 million for the subject site).

The applicant relied nevertheless on an earlier study by Mr Leyshon prepared for the respondent in 1996 as to the lack of feasibility of the Holland Park site. The applicant also relied upon opinions expressed by its consultant town planner, Mr N Ingham, and its architect, Ms C Hogan, to establish that the Holland Park site was simply not feasible by reason of construction cost.

However, having regard to Mr Hill's evidence I do not accept the applicant's assertion that Holland Park is not a feasible site on the question of construction costs when compared with construction costs on the subject site. Mr Ingham, however, said that the Holland Park site was also unsuitable because it lacked street exposure and its likely car parking area would be within a flood prone area. One of the existing supermarkets in the Windsor town centre also suffers from lack of street exposure, but is apparently trading very successfully. However, according to Mr Ingham that supermarket (Franklins) is known for its high degree of customer loyalty.

As I have said, I have considerable doubt as to whether any of the abovementioned evidence amounts to a relevant consideration under s 90(1) of the Act. In any event, even if relevant I regard this evidence of being of neutral value on the merits. In other words, I do not regard this evidence, some of which relates to Issue (6), as being relevant but if I am wrong I do not find it decisive one way or the other.

Issue (12) is in a slightly different category, since it potentially raises the kind of consequence described in Kentucky Fried Chicken Pty Limited v Gantidis, being a relevant consideration.

Mr Leyshon had conducted a survey of the shopping habits of shoppers in the Windsor town centre. He found that 52 per cent of those interviewed visited a supermarket together with other retail stores in Windsor on the same trip; 23 per cent indicated that they were only visiting a supermarket and 25 per cent indicated that they were only visiting other stores and not a supermarket. Mr Leyshon also obtained some information on expenditure patterns in the Windsor town centre. The average shopper spends about $27 at either of the two supermarkets, but also spends an additional $20 at other non-supermarket retail and service establishments on the same trip. This level of ancillary spending demonstrated a clear nexus or synergy between supermarket and non-supermarket shopping in the Windsor town centre. There was thus a potential impact on the specialty retailers in Windsor in the event of any change in supermarket shopping patterns arising from a new supermarket in an out of town location such as the subject site at South Windsor. According to Mr Leyshon, there will be an impact in any event on the specialty retailers in Windsor by the presence of the discount department store now under construction at Richmond. That development would have a threefold effect on retail trading patterns in the area. It will contribute to reducing escape expenditure flowing to other centres such as Penrith and Blacktown; it will have an impact on the operations of existing supermarkets in Windsor and also on specialty stores in Windsor; and as well as attracting shoppers who reside in the Windsor area it will also make it less likely that Windsor stores will attract shoppers from Richmond, North Richmond and Kurrajong, who form a small but important component of Windsor's trade area.

According to Mr Leyshon, the existing nexus or synergy between supermarket shopping in Windsor and expenditure at specialty stores in Windsor would be affected by the proposed out-of-town supermarket on the subject site. In his opinion there is every likelihood that a proportion of residents in Windsor's primary trade area making use of the proposed Woolworths supermarket at the subject site, would direct a higher proportion of their non-supermarket shopping to the new discount department store in Richmond rather than to non-supermarket retailers in the Windsor town centre. In other words, the provision of a new supermarket on the subject site would break, to some extent, the present nexus, as demonstrated by survey data, between shopping at existing supermarkets in Windsor and associated shopping at non-food specialty shops in Windsor.

As previously mentioned, the average shopper in the Windsor town centre spends approximately $20 on non-supermarket items per shopping trip. Drawing on customer figures produced by the applicant's retail economist, Mr A D Dimasi, Mr Leyshon calculated that these customers could potentially generate spending of up to $14.145 million per annum in the Windsor town centre on non-supermarket products and services. He said in his report prepared for this hearing:

"If 20% of this potential non-supermarket spending is directed to the new DDS-based centre in Richmond by those undertaking their supermarket shopping at Woolworths at South Windsor, the non-supermarket stores in the Windsor Town Centre could expect a decline in sales of some -$2.829 million per annum.

Thus total sales in non-supermarket stores in the Windsor Town Centre could decline to some $10.971 million per annum from the current level of $13.800 million per annum. In total, sales in the Windsor Town Centre could be reduced to as low as $32.279 million per annum ($ 1994-95), a decline of -$14.996 million per annum overall or -31.2%. A contraction in sales of this scale would have a significant effect on the existing vitality of the Town Centre particularly given that it must also face competition from the new Richmond centre from mid-1997."

In cross-examination Mr Leyshon conceded that a 20 per cent loss in spending at Windsor was an estimate of the worst case scenario. He expressed an opinion that a 10 to15 per cent reduction in non-supermarket spending was more likely. However, in his opinion a 15 per cent reduction in trading by non-supermarket shops in Windsor would probably "marginalise" them. The closure of even one of those stores would diminish the strength of the Windsor town centre to some extent. The Windsor town centre is already about to experience a detrimental sales impact following the opening of the discount department store and associated Woolworths supermarket in Richmond. The approval of a free-standing supermarket on the subject site would exacerbate this impact. In Mr Leyshon's opinion a preferred course is either the development of a new supermarket in the Windsor town centre or the expansion of existing supermarkets in the Windsor town centre.

Mr Dimasi, the retail economist called by the applicant, did not refer to this topic at all in his two reports which were tendered during the hearing. He referred to it for the first time during his oral evidence. Without having conducted any survey, he thought that the provision of a supermarket at the subject site would increase, rather than decrease, the possibility of non-supermarket shopping in Windsor.

Again without the benefit of any survey data, Mr Dimasi thought that there may be about a 10 per cent loss of the sales of food, liquor and grocery products in Windsor as a result of the impact of all current and projected projects in the Hawkesbury area, including the subject proposal, which impact would be the same if a new supermarket was to be located in the Windsor town centre itself. Mr Dimasi thought that a reduction in trading of 5 to15 per cent in the Windsor town centre could be absorbed, but not a loss of 20 per cent.

I prefer the evidence of Mr Leyshon on this topic. Mr Leyshon's views were carefully formed and the considered result of survey data obtained by him. Mr Dimasi's views on this topic were, as I have said, not contained in either of his two reports, were not based on any survey data conducted by him or on his behalf and seemed to be expressed more as an afterthought rather than a considered opinion. Mr Ingham agreed that there was a synergistic relationship in the Windsor town centre between the existing supermarkets and the non-supermarket businesses, which he said, assists the centre as a whole. Mr Ingham also expressed a preference, "all things being equal", for a supermarket to be located in the Windsor town centre rather than outside it. His main concern was that the most readily available site in the Windsor town centre, the Holland Park site, was both flood prone and lacked main street exposure.

In short, I accept the opinion of Mr Leyshon that there is likely to be a 10 to15 per cent decline in non-supermarket trading in the Windsor town centre if the present proposal were to proceed. That is to say, the out of town, stand-alone supermarket now proposed will to a significant extent break the synergy or nexus between supermarket and non-supermarket shopping in Windsor. To "marginalise" the non-supermarket businesses in the manner described by Mr Leyshon would clearly put at risk the viability of those businesses. The effect would be as described in Kentucky Fried Chicken Pty Limited v Gantidis: The facilities presently enjoyed by the community in Windsor would be put in jeopardy by the proposed development and the resultant community detriment would not be made good by the proposed development itself. That is a proper consideration to be taken into account as a matter of town planning. It is a very real risk which, on balance, I am satisfied should not be taken. For these reasons Issues (6 ) and (12) are resolved in favour of the respondent and this development application should not be approved.

The remaining issues, (7) to (11), are not of such a fundamental nature as to alone justify a refusal of the proposal. During the hearing an amended plan was tendered by the applicant in which the proposed building was moved from its original location 2 metres from the eastern boundary of the site so as to be 10 metres from that boundary. The eastern boundary adjoins medium density residential development. By this amendment the impact of the building on the adjoining residential development was lessened and a more satisfactory area made available for landscaping. Whilst it is apparent that the building itself would be out of character with the residential area, so also is the existing timber yard. Any potential problems with noise could be readily met by appropriate conditions of consent. Neither am I satisfied that stormwater could not be satisfactorily discharged to Woods Road, either by way of an easement through the adjoining properties or by appropriate piping within the road reserve.

I conclude by acknowledging the assistance given to me by Dr C Bull, a conciliation and technical assessor of the Court, who heard the case with me.

I certify that this and the preceding 19 pages are a true copy of the reasons for judgment herein of The Honourable Mr Justice Lloyd.