1 Before the development commences, three copies of amended plans must be submitted to and approved by the Responsible Authority. When approved, these plans will become the endorsed plans and will form part of this permit. These plans must be generally in accordance with the plans tabled at VCAT hearing P61/2004, but must be amended to show:

(a) Relocation of the window to bedroom 1 of Dwelling 14 (and if possible the living room above it) to face north (rather than opposite Unit 9) - highlight windows can still be placed in this eastern wall.

(b) Either move the window to the bedroom of Unit 5 or provide planter boxes/screens in front of the window to improve privacy from the stair which will serve Unit 6.

(c) Provide screens between habitable room windows or offset the windows in the following:

(i) bedroom 2, Dwelling 4 and the living room window of Unit 2;

(ii) the living room/kitchen windows of Units 9 and 10 and bedroom 1 of Unit 13; and

(iii) bedroom 2 of Unit 10 and bedroom 1 of Unit 13.

(d) Revise the east-facing screen detail in the following manner:

(i) lower the screen to Dwellings 1 and 3 to about 1.2 metres above floor level and lower all second floor screens to about 1.3 or 1.4 metres (consistent with the height of the solid balustrades);

(ii) add planter boxes inside the edge of the terraces to Dwellings 9 and 10 (up to balustrade height). Such planters shall be a minimum of 600mm wide;

(iii) revise the screen detail in Dwelling 2 so that the solid screen is replaced with a louvered transparent screen, capable of preventing overlooking to the rear yard of No.1 Campbell Street (with sight lines shown).

(e) Provide a verandah/canopy and an above verandah fascia board to the shop commensurate with other nearby shop fronts in Sydney Road.

(f) Provide detailed schedule of materials, finishes and colours of all new buildings, with particular emphasis on upgrading the standard of textured finishes to the exposed walls of the southern, eastern and northern facades of walls including:

(i) detail the finishes of the eastern elevation to the right-of-way including high quality textured non-reflecting rendered materials to the first, second and third floor wall elements;

(ii) detailing of the south and north-facing walls (above ground level) or visible exposed areas to provide detailed textured finishes, but such that that the colours are light in colour.

(g) A colour schedule of the hotel facade (including minor restoration work to external finishes) which also details methods to remove the existing paint work in accordance with approved heritage practices.

(i) Notation depicting a physical separation between external exits from the hotel and remaining residential development such that patrons of the hotel do not use the garage as an exit facility from the hotel.

(j) Nomination on the plan that both garage doors shall be of automatic opening type.

(k) Provision of at least 6 cubic metres of storage space for each of the residential units.

(l) Provision for a kitchen flue facility (either through the upper residential level in the hotel or some other location which did not comprise the external integrity of the hotel building).

(m) Nomination of the minimum width of the car space to Dwelling 1 being 2.7 metres.

(n) Revision to the manoeuvring space in the garage area behind the shop in accordance with the recommendations of Mr Fairlie in his report dated 23 March 2004 to VCAT hearing No. P61/2004.

(o) Details of the materials (whether gates or fencing ) of the garage to ensure the walls are placed on the external side of columns.

All amendments must be to the satisfaction of the Responsible Authority.

2 Prior to commencement of demolition works the Applicant must supply to the Responsible Authority a detailed landscape plan for the development as approved by this permit which must show amongst other things:

(a) Replacement of the two existing Canary Island Date Palms with a suitable alternative (such as Washingtonia or similar) up to 8-10 metres in height.

(b) Planting for terraces and walkway areas keeping in mind the need to assist in providing privacy screening between dwellings or between public areas and dwellings.

(c) Site preparation, details of irrigation and drainage systems, and the maintenance procedures to assist in the long term viability of such planting, all of which shall be to the satisfaction of the Responsible Authority.

3 All such landscaping must be completed prior to occupation of any dwelling or the shop and shall be maintained to the satisfaction of the Responsible Authority.

4 The development as shown on the endorsed plans including paintwork/restoration finishes of the hotel and painting, render/external features, must not be altered unless with the written consent of the Responsible Authority.

5 Prior to the commencement of the development, a waste management plan must be submitted to and approved by the Responsible Authority showing and detailing:

(a) The provision of dual bins for each unit to encourage separation of garbage from recyclables;

(b) A plan showing separate garbage facilities for the shop, hotel and residential section of the development and where appropriate provision for a ramp to serve the hotel;

(c) The location of the bins and details of separation noting that rubbish may be removed from the shop and hotel premises from the Sydney Road frontage and removal of garbage from the residential development from the rear right-of-way to the satisfaction of the Responsible Authority. Such arrangements may be amended with the consent of the Responsible Authority.

6 Prior to the commencement of the development, a detailed stormwater drainage plan must be submitted to and approved by the Responsible Authority.

7 Appropriate acoustic measures should be carried out to insulate the dwellings from excessive external noise sources.

8 Prior to the commencement of the development, a report prepared by an accredited energy rater must be submitted to the Responsible Authority, certifying that each of the dwelling units will be designed to achieve a 4 star energy rating.

9 The area set aside for the parking of vehicles and access lanes shown on the endorsed plan must, to the satisfaction of the Responsible Authority:

(a) Be completed prior to the occupation of the development;

(c) Be properly formed to such levels that it can be used according to the endorsed plan;

(d) Be drained and surfaced with an all-weather seal coat;

(e) Have the boundaries of all vehicle parking spaces clearly marked on the ground to accord with the endorsed plan;

(f) Not be used for any other purpose other than the parking, of vehicles unless with the written consent of the Responsible Authority.

10 Access to the site, any vehicle crossover and any ancillary road and road drainage works must be constructed in accordance with any requirement of the Responsible Authority.

11 Air-conditioning and other plant and generator equipment installed on the subject building shall be positioned and baffled so that no noise disturbance is caused to occupiers and adjoining properties.

12 Air-conditioning and other plant and generator equipment must be appropriately screened from the view 6f adjoining properties and the street to the satisfaction of the Responsible Authority.

13 All telecommunications and power connections (where by means of a cable) and associated infrastructure to the land must be underground to the satisfaction of the Responsible Authority.

14 Any plumbing pipe, ducting and plant equipment must be concealed from external views. This does not include external guttering or associated rainwater downpipes.

15 Electricity, gas and water meters must be located to the requirements of service authorities.

16 Every dwelling must be connected to reticulated water, drainage, sewerage, electricity, gas and telecommunications to the satisfaction of the relevant service authority.

17 A mailbox must be provided to each premises. The mailbox dimensions, location and height must be consistent with the standards specified by Australia Post to the satisfaction of the Responsible Authority.

18 This permit will expire if one of the following circumstances applies:

(a) The development is not commenced within two (2) years of the date of issue of this permit;

(b) The development is not completed within two (2) years from the date of demolition works. The Responsible Authority may extend the periods referred to if a request is made in writing before the permit expires or within three months afterwards.

Ms S Brennan of Counsel. Ms Brennan called evidence from:

Mr L Luka, Town Planner. Mr Luka called evidence from Mr D Wixted, Architectural Historian

1 This is an application for review pursuant to Section 77 of the Planning and Environment Act 1987 against the decision of Moreland City Council to refuse application for permit No. MPS2003/0420 involving substantial alterations to an existing hotel, and development of a four storey building comprising shop and 17 dwellings. Initially this was nominated as an application pursuant to Section 79 but the application for review was lodged on the same day that the Council had issued the refusal notice. At the hearing all parties agreed that it was expedient to deal with this matter as a refusal and therefore the review was treated under Section 77 of the Act.

2 It is proposed to undertake substantial demolition work at the rear of an existing hotel and erect a new shop and 15 new dwellings in a four storey structure. The upper level of the hotel would be converted to two dwellings (to give a total of 17 new dwellings) and there would be provision for 25 car parking spaces on site.

3 The existing heritage section of the hotel building would be retained and the bar area substantially reduced in area. An existing dining area would be converted into a new bar/billiard room.

4 A common walkway would be provided to the rear of the hotel separating the new residential section of the development. A new shop would be erected on the northern side of the site facing Sydney Road with a pedestrian walkway placed in between the new shop and the existing hotel.

5 Two existing Palm trees would be removed and replaced with alternative species.

6 Vehicular access to the car park would be via an existing 3 metre wide right-of-way which has access to both Campbell Street and The Avenue.

7 Residential accommodation would be provided in two units at first floor level of the hotel. Three dwellings would be placed in a central position and two three dwellings placed along the northern boundary. There would also be three levels of accommodation above the car parking oriented to the east. This would comprise single level dwellings on level 1 and two storey dwellings on levels 3 and 4.

8 The east-facing elevation of the development would be stepped back away from the right-of-way and contains terraces designed to face out towards the east.

9 The Tribunal was told that the applicant was prepared to undertake restoration works to the façade of the hotel. This principally encompasses removal of existing paint work and repainting in more appropriate heritage colours (with some minor remedial/restoration work).

10 The subject site is located on the eastern side of Sydney Road between The Avenue and Moore Street in Coburg. The site has a frontage to Sydney Road of 31.29 metres and an overall site area of 1259 square metres. The site is relatively flat.

11 The site contains a two storey heritage hotel building known as the Woodlands Hotel which dates back to the 1850s. It is said to be the oldest hotel in the City of Moreland and is of considerable merit both in terms of architectural and historic significance. The hotel building predominantly occupies the south-western corner of the site. Whilst there is a beer garden on its northern side and a number of old buildings added in the 1970s and 80s behind, these are of no historic significance and are proposed to be removed.

12 There is car parking at present for 15 spaces with access via the right-of-way.

13 Land to the north of the site is a Salvation Army Citadel and related facilities. The Citadel is located in a heritage building, there have been a number of rather unsympathetic (architecturally speaking) additions to the building which assist in providing services to the community.

14 Land to the south of the site comprises single storey shops. Land further to the south is known as the Old Market development comprises retailing at the front and two and three storey apartments. These units have an orientation to the north. They also have vehicular and pedestrian access off the rear right-of-way close to the southern entrance to Campbell Street.

15 Land to the rear comprises a single storey Victorian cottage. It has a number of windows facing the existing car park to the hotel. These windows have bars across them and the Tribunal noted on its inspection that the panes in the lower section of each window has obscure glazing (apparently to provide for improved privacy). There is also a small open space area oriented to the north of the dwelling.

16 To the north-east of the subject site is an open space related to a child care facility.

17 The surrounding area is a mix of commercial, residential and community uses. Most commercial uses are oriented towards Sydney Road and are either single or two storey in height. There is a lack of uniformity in the facades and uses along this section of Sydney Road.

18 Land in Campbell Street area is predominantly single storey dwellings (with some exceptions).

19 The subject site is zoned Business 1 under the Moreland Planning Scheme. The purpose of the zone is:

* To encourage the intensive development of business centres for retailing and other complementary commercial, entertainment and community uses.

20 The site is also located within two Heritage Overlay areas. Firstly it is located in the more general "The Grove Heritage Area" and secondly, but probably more importantly, the site has its own Heritage Overlay (HO150). The City of Moreland Heritage Review Building Citation gives this building a "B" status and describes its significance as:

The Palm Avenue Hotel is a symmetrical two storey brick building with two prominent stepped pediments at parapet level. The facade was refaced in 1891 when the building was enlarged and renamed the Woolpack Hotel. The ground floor has American Romanesque Revival detailing such as arched openings supported on short, stylised columns and ornate stucco decoration in the spandrels. The first floor and the parapet are treated in a freer fashion, with a mixture of arched and portal windows, a central balcony and stilted pediments and finials rising above the parapet. The roof is corrugated iron; the windows are multi-paned timber-framed sashes.

* To undertake buildings and works (for the residential and shop development)

* To undertake buildings and works to a Section 2 use (existing hotel) pursuant to Clause 63.05

* To undertake demolition works and alteration and additions to the hotel pursuant to Clause 43.01

* To reduce or waive the car parking requirement for shop and dwelling under Section 52.06

* To waive the requirement for a loading bay pursuant to Clause 52.07 (relating to the shop activity)

22 The purpose of the Heritage Overlay is, where relevant:

* To conserve and enhance heritage places of natural or cultural significance.

* To conserve and enhance those elements which contribute to the significance of heritage places.

* To ensure that development does not adversely affect the significance of heritage places.

23 There are various planning controls and policies of relevance in this application including:

* Decision guidelines in Clause 34.01-4 (Business 1 Zone)

* Decision guidelines in Clause 43.01 (Heritage Overlay

* Clause 21.06-5 Urban Design, Urban Character and Street Landscapes

* Clause 21.05-2 Focus Areas for Change - Urban Villages

24 At the review hearing all parties made oral and written presentations. The Tribunal was provided with an array of information including Planning Scheme maps, copies of Council policies, photographs of the site and neighbourhood, plans and elevations, and various witness reports. All witnesses were available for cross-examination.

25 At the commencement of the hearing Mr Luka and Ms Wysocka raised concern about the lateness of tabling of witness reports. Ms Wysocka also raised concerns about not receiving a set of revised plans and elevations. Accordingly the matter was briefly adjourned for copies to be made available to Ms Wysocka and an explanation of the revised plans to be provided. The Tribunal also arranged for various witnesses to be made available to ensure that Ms Wysocka was able to cross-examine all witnesses on the first hearing day as she was not able to attend on the second hearing day.

26 The Tribunal undertook an inspection of the subject site and locality following the second day of the review hearing and this included a visit to Ms Wysocka's property.

27 Having heard all the submissions the principal issues relate to:

* Appropriateness or otherwise of access to the right-of-way

* Whether the proposed new development adequately respects the heritage building

* Whether the heritage significance of the site will be compromised by the proposed development

* Methods to preserve the heritage performance of the site including works to reinstate or conserve the facade of the building

* Internal and external amenity issues including overlooking

* The adequacy or otherwise of external building treatments including materials, finishes and colours

28 I am satisfied that the applicant has approached the conservation of the important elements of the heritage building, notably the remnant part of the hotel in an appropriate manner. I acknowledge that a substantial portion of the rear buildings and the beer garden will be removed by this proposal, but there was no evidence tabled at the hearing to suggest that any parts of the building to be removed had any heritage significance whatsoever. Based on the evidence of Ms Riddett I am satisfied that the existing section of the hotel will be retained and that the works around the edge of the hotel are appropriate having regard to previous works undertaken to it.

29 I am generally satisfied that the applicant has separated the proposed new residential component of this site from the hotel and that this separation will be seen as an effective technique in differentiating those elements of the site which are of heritage value from the new development.

30 Similarly I see no major obstacle to the first floor fit out which would create two dwellings above the existing bar area. This would seem to be a reasonable conversion of the original residential section of the hotel into another form of residential accommodation.

31 I note in evidence however there may be a need for a minor alteration to this layout to accommodate a flue in the event that a new kitchen is provided in the ground level of the hotel. This can easily be achieved by a condition on permit.

32 The Tribunal was also alerted to Amendment C43 to the Moreland Planning Scheme which contains Council's proposed new neighbourhood character and building over three storeys (BOTS policies). The Tribunal has not had much regard for this amendment as it has only recently been examined by an Independent Panel. A report has not been prepared nor has the matter been finally considered by the Responsible Authority or the Minister for Planning. It therefore does not reach the status of a seriously entertained planning proposal.

33 There was no objection to the shop use and it was agreed by the parties that it would be desirable for a canopy/verandah to be provided. During cross-examination by the Tribunal the applicant also conceded that a fascia board above the canopy could be inserted to be consistent with most other shopfronts along this section of Sydney Road. It was also acknowledged that the shop building was sufficiently separated from the existing heritage building so as not to detract from its architectural significance.

34 The principal issues of objection by the both the Responsible Authority and Ms Wysocka related to the relative height, bulk and external architectural treatment of the proposed building. The Responsible Authority wished to see the top level section of buildings behind the hotel in the centre of the site removed and considered the eastern section too high. Mr Wixted suggested that the central area of the site should be made available for future expansion of the hotel, he also suggested the top storey of the eastern wing should be removed. Ms Wysocka was more concerned about the visual appearance of the eastern section of building and other high sections of wall.

35 I acknowledge that in elevation form the appearance of the new building is rather bland and it could be somewhat improved by better attention to the external finishes and materials. During cross-examination Mr Borelli conceded that further attention should be given to materials, finishes and colours of the building, including external texturing.

36 I note Mr Borelli referred to the apparent stepping back of the eastern section of the building away from the right-of-way so as to reduce the visual bulk and massing on properties to the east of the right-of-way and the right-of-way itself. This technique also assists in reducing overlooking to No1 Campbell Street.

37 During the hearing comparisons had been made with a recent development comprising five stories further to the south at 48-52 Sydney Road which had a fairly strong rectilinear brutal design. I am satisfied this development will not have the same dramatic impact on Sydney Road because it is set well back from Sydney Road and is essentially screened from direct view due to the presence of the Hotel building. I also consider the rear section, whilst noticeably higher than surrounding properties, will not be as large and bulky as 48-52 Sydney Road.

38 I am generally satisfied that the proposed building bulk and massing of the development will fit reasonably into this mixed area. However I consider there are a number of measures which can be undertaken to improve the appearance of the building, and more importantly, improve the quality of the external finishes and materials of the building.

39 I note this site is in a heritage area, and whilst most observation of the new building, particularly the four storey section, will be from outside the Heritage area. The major impact will be viewed at an oblique angle from the lane outside the Heritage areas. Whilst pedestrians in Sydney Road will be able to obtain a glimpse of the building from various angles, it will not be highly visible from the commercial frontages. Nor will it have the same imposing impact on the Sydney Road Streetscape (compared to the building at No 48-52 Sydney Road).

40 During my inspection of Ms Wysocka's dwelling I noted the top section of the proposed development will be visible from upper floor areas and the balcony and whilst it will change the sky outlook there is no provision in the Moreland Planning Scheme which requires the protection of sky views. Rather I consider it more appropriate to address the treatment of walls (which are in excess of 20 metres from her property).

41 It is acknowledged that the proposed development is of a fairly intense form and it would be difficult to justify its approval if it was located in a fairly conventional Residential 1 zoned area such as the neighbourhood to the east. But the proposed development is situated in a Business 1 zone in a busy activity area on a major metropolitan arterial road with excellent access to shops, public transport and community services. In fact the site is located within one of the priority urban village sites in the Housing Strategy section of Clause 21.05 of the Moreland Planning Scheme. Of course there are some site constraints (and opportunities) due to its heritage status and the residential interface to the east, but these have been appropriately addressed by Ms Riddett and Mr Borelli. However it would appear the responsible authority has not given sufficient weight to this strategic location, the policy support for it in Melbourne 2030 nor its own Municipal Strategic Statement which supports a more intense form of development this location.

42 During the hearing there was much discussion about whether this development would provide affordable housing in accordance with Council policies. I note the dwellings are one and two bedroom with open plan layouts. Most dwellings have one car space. They appear to be modest in their proportions and suited to single persons or couples. They do not appear to be luxury style apartments. Whilst there was some debate about the viability of the project if various dwellings were removed or the cost penalties associated with applying high quality finishes. I consider this development can still achieve a high standard of external finish (without necessarily altering the internal layout or fittings of the dwellings) and still achieve a relatively affordable housing outcome.

43 I have, following acknowledgement by Mr Borelli of the shortcomings about finishes and materials, inserted a number of conditions on permit requiring, amongst other things, detailed landscaping plans, revised screening treatment to terraces so as to reduce the visual bulk of the eastern elevation particularly where there was not a demonstrable need for 1.7 metre high screens, and further, detailed elevations showing materials, finishes and colours. In this regard I consider it is of vital importance that the applicant engage additional design expertise on the external wall treatments in consultation with councils urban designer to produce improved textured finishes to external walls and more particularly those above ground level facing east, south and west and close to the walkway areas around the hotel building.

44 It is also important to engage a person of Ms Riddett's expertise to assist in the removal of old paint by proper practices and new painting (and minor restoration works) of the hotel building. I agree with Ms Riddett's evidence that there is no need or justification for a condition requiring a conservation plan.

45 There are however a number of conditions required relating to the provision of storage for rubbish bins for the hotel and shop that need to be shown. Similarly there is a necessity to separate the common walkway and the car park and residential section so that hotel patrons do not use the car park serving the dwellings or staff of the hotel. Accordingly a suitable gate should be provided which is capable of being locked.

46 I am satisfied that the existing Canary Island Palms on the site have outgrown their place and are suitable for removal and replacement with a different variety of Palms as shown on the endorsed plans. I am satisfied that Washingtonia variety will achieve a reasonable result provided they are at least 8-10 metres in height at planting and that suitable measures are undertaken to ensure their long term viability in these locations.

47 I also consider it important that a detailed landscape plan be provided as I think this is an important element in providing a high level of amenity to occupants of future dwellings. I consider that the landscaping plan must be of a high standard and designed to ensure adequate privacy between windows in various dwellings.

48 I have required removal or lowering of screens to terraces, firstly as a measure to improve the visual appearance of the eastern elevation but also because in many respects they are not directly needed having regard to the walls and features opposite. Whilst there is an open space area on No 1 Campbell Street opposite Dwellings 9 and 10, remaining areas of that property are not directly affected. I noted the side wall of 1 Campbell Street not only had bars across its windows but the (lower panes) contained translucent glazing probably in an effort to maintain some privacy from pedestrians and vehicles using the lane.

49 I am generally satisfied that the car parking provision is suitable for the future occupants of the development. It is acknowledged that hotel patrons will rely more on on-street car parking in both Sydney Road or nearby streets. I also acknowledge that at times there may be some difficulties for visitors to find parking in close proximity to the site, but for most parts, nearby streets have the capacity at present to accommodate visitor parking. In this regard I note that Campbell Street has no parking restrictions and there is availability for parking outside the Kangan TAFE in The Avenue on Friday evenings and weekends. I also note that by removal of an existing disused crossover to Sydney Road that one additional on-street car parking space can be provided.

50 I note that the car park layout can be modified in accordance with the recommendations by Mr Fairlie so as to improve manoeuvring particularly for Dwellings 1 &2, but also by minor widening of car spaces to Dwelling 1. Similarly I am satisfied that the car park will be secure as it will have remote control doors and I have place a condition requiring physical separation of the garage to ensure hotel patrons do not use it.

51 I am generally satisfied that the 3 metre wide right-of-way to the rear of the property is adequate, noting that for most parts at ground level it will be widened to 3.6 metres to assist vehicles exiting this site. Similarly I am satisfied that access to either Campbell Street or The Avenue is appropriate having regard to the number of vehicles using it. I acknowledge the concerns raised by Ms Wysocka about cars utilising the right-of-way and travelling at speeds, however from my observation, the vehicles detected using the laneway during my inspection travelled fairly slowly. I have however inserted a condition as recommended by Mr Fairlie to install a speed hump in the lane outside the site.

52 I also note, based on my observation of vehicles using the lane, that vehicles seem to travel from either the Kangan TAFE or other streets and use the lane as a short cut to other streets. If this poses a real problem to residents then I suggest the appropriate action is for the Responsible Authority to investigate traffic movements in this right-of-way and introduce various traffic calming devices (if warranted).

53 I do not see that the increase in 8 car spaces (net) from this development proposal is a substantial increase in this particular locality. I acknowledge that the times of car travel by occupants of this new residential development are likely to be different than that of hotel patrons, but I consider that in many respects the amenity of the area could in fact be improved by enclosing of the car park on this site.

54 There was a suggestions by Mr Wixted that controls should be placed on future strata titling of this development. I discount this assumption firstly because this application does not involve subdivision. Rather a separate subdivision permit is required if and when subdivision is sought. If such application is made it will be for the responsible authority to consider it according to the relevant provisions of the planning scheme.. However I would remark that I see no problem in conversion of the existing heritage building and use of some dwellings for individual occupations. This approach is not unique in re-use or adaptation of heritage buildings including hotels.