1. The key issue in this case is what the height of a new building on this site should be. We have formed the view that what is proposed is too high for this site. It was acknowledged amongst the parties that this site does have the potential to accommodate a higher building than that which currently exists on the site and in the immediate surrounds, hence it is possible there will be a subsequent planning application for this site. For this reason we explain our concerns with regard to the height and form of the building as well as our findings on the issues relating to the internal and external amenity impacts, the architectural style and detailing of the building, and the car parking and traffic impacts. We trust that they will be of assistance to all parties in preparing and considering any subsequent planning application for this site.

1. The acceptability of the height of the proposed building is to be determined having regard to the planning policies and controls that are relevant to this site and this area, and the physical context of the site and surrounds.

1. Mr Beard and Mr Canavan both submitted that the key issue in this case is the interpretation of the Local Planning Policy Framework in the planning scheme and, specifically, the new Municipal Strategic Statement (MSS) that came into effect on 27 June 2011. As the MSS is new, its content is largely untested in regard to the interpretation of the meaning of its policies and strategies. The relevance of interpreting the planning policy framework in this case is to essentially determine how high a building can be built on this site. The Council says somewhere between 5 and 7 storeys, some of the nearby resident objectors consider a height of 5-6 storeys would constitute 'moderate' growth in this business zoning near St Kilda Road, and the Applicant proposes 11 storeys.
2. However, before discussing the MSS, it is important for the parties to realise it is the combination of both the State and local planning policies in the planning scheme that we must consider. Mr Beard briefly highlighted the State planning policies at clauses 11 and 15 of the planning scheme, but Mr Canavan pointed out the Council did not highlight the significance of clause 16. We agree that all of these clauses are relevant to our decision and note that they:
   • Seek urban growth close to transport and services to provide efficient and effective use of existing infrastructure, and this site is in a location that meets this criteria;
   • Encourage urban design that contributes positively to local character, enhances the public realm and minimises detrimental impacts on neighbouring properties; and
   • Identify strategic redevelopment sites that are suitable for increased densities of housing, which includes this site.
3. The Applicant argued this is a large site located in an area in which increased numbers of dwellings are strongly supported by policy, hence "mere lip service to urban consolidation, and housing density and affordability" is simply not an option in this case. We agree that the site area of around 1,300 square metres provides a significant opportunity for the development of new and diverse housing. However, this clearly does not mean the potential for height is unlimited. There are other factors to be considered, including those put forward by Council and the resident objectors to this particular proposal. These include the existing physical context, the constraint imposed by the Heritage Overlay on the redevelopment opportunities on the north side of Alma Road (opposite this site), the visual impact of the proposal on the neighbourhood, and its location in Alma Road, as opposed to St Kilda Road.

1. The Council acknowledges the business zoning of this land and its strategic inclusion in a moderate growth area provides "anticipation" that this site can provide for an increased density of housing.
2. The site is zoned Business 2, as is the land to the north (on the opposite side of Alma Road), and to the west and south along St Kilda Road. However, as already stated, the north side of Alma Road is affected by a Heritage Overlay and the land to the east and northeast is zoned Residential 1. This means this site is located at the interface between the commercial and residential zoned land, and in a business area, all of which have differing degrees of development potential.
3. In the MSS, the business zoned land on either side of St Kilda Road surrounding this site is described as "St Kilda Road South" and includes the following objectives:

Support commercial development as a primary function on sites that front St Kilda Road.

Encourage moderate intensification of housing, subject to heritage and amenity considerations, above and behind the St Kilda Road street frontage.

Ensure new development responds and compliments the scale and setbacks of buildings along the east side of St Kilda Road.[2]

1. Similar sentiments are expressed in clause 21.04-3 of the MSS relating to office and mixed activity areas. One of the objectives is to facilitate viable and vibrant business activity in office and mixed use precincts with a strategy to encourage residential uses above the ground floor to ensure commercial functions are not lost. In regard to land uses, the MSS describes St Kilda Road South's primary function as an employment node with office/commercial roles and active ground floor uses. The intensification of housing and retail showroom/restricted retail are secondary/supporting functions. Some of the residents submitted this proposal is not in accordance with this policy direction as it has limited the commercial component of the proposal to just a ground floor office space. Whilst we agree that the commercial component is significantly smaller than the residential component of this proposal, we note the Council supports the extent of the land uses proposed and hence we are not persuaded this is a reason why this proposal should be refused.
2. The key question in this case is what constitutes a moderate intensification of housing. We find the MSS is unclear in terms of the built form outcome it envisages for this case. The five 'levels' of development contain broad statements without clear guidance as to the height and scale such development should take. We appreciate this may have been deliberate to provide flexibility but we consider this case identifies some of the difficulty in interpreting policy. In this case, the interpretation of the policy by the Council and the neighbours envisages a significantly lower scale of development from that sought by the Applicant.
3. One of the traps in interpreting planning policy is to focus on the particular rather than the whole of the policy. For example, the Council's presentation of its interpretation of the policy 'jumped' straight to the level of development without focussing on how these levels of development are categorised and what overarching development objectives are sought by Council's policy.
4. Clause 21.04-1 provides the basis or structure for future housing growth within the municipality. It contains two objectives to guide the expected intensity of new residential development throughout the municipality. The first objective relates to substantial and moderate residential growth areas and states:

To provide significant opportunities for new residential development in designated locations which have the capacity for change, and which offer highest accessibility to public transport, shops and social infrastructure.

1. The second objective is to ensure new residential development does not compromise the heritage, neighbourhood character and amenity values of established residential areas. This is to be achieved by limiting new residential development in areas designated as incremental residential growth, limited residential growth and minimal residential growth. This site does not fall into any of these areas, rather it is a specifically identified[3] moderate residential growth area.
2. On page 2 of clause 21.04 it states the intensity and scale of new development in the moderate residential growth areas must respect the existing streetscape character and commercial context of the centre. On page 3 is a definition of each of these growth areas, and the definition of moderate residential growth areas includes the following sentence:

The location of development and level of intensification will vary across centres depending on the streetscape and heritage character, and lot size.

1. All of the parties and the expert witnesses agree that this site is suitable for some form of high density development, but the extent to which this potential should be tempered by its streetscape (including the existing streetscape) and heritage character is in dispute. Mr Milner gave evidence for the Council recommending a height of between 5 and 6 storeys, a view shared by some of the nearby resident objectors, and the Council's internal urban designer recommended a height of up to 7 storeys.
2. Mr Milner said the proposal should be scaled down on the basis that it is located in a moderate rather than substantial residential growth area. We agree with Mr Canavan's submission that this approach fails to recognise that the moderate change level of development is the second highest designation in a scale of five levels. Further, the objective quoted in paragraph 16 above is the same for substantial and moderate growth areas. There is no reference to amenity in any of the descriptions or restrictions placed upon the development potential within a moderate residential growth area. Any necessity to temper the development potential of this site is influenced by the following factors[4]:
   • the existing streetscape character and commercial context of the centre;
   • the streetscape and heritage character; and
   • the lot size.
3. There is no dispute amongst the parties that this site is large in size and has the capacity to accommodate a higher building than that which exists in the immediate surrounds on the east side of St Kilda Road at present. Hence, the acceptability of the height proposed needs to be considered having regard to the streetscape, context and heritage character.

1. The Applicants' witnesses support the proposed height of 11 storeys on the basis that it is a large site within an activity centre, close to other activity centres with excellent access to public transport and a range of shops, restaurants, supermarkets and other facilities. Other benefits are the lack of any heritage or design overlay controls and its interfaces with the RDNS building, a laneway and other commercial properties. The Applicant and its witnesses also relied upon what Mr Canavan described as a "robust and varied built form context" that includes two buildings on the opposite side of St Kilda Road, being the 8 storey Santorini building in Alma Road and the 13 storey Maxx building (under construction) on the southwest corner of Alma and St Kilda Roads.
2. The Applicant, through the evidence of both Mr Govenlock and Mr Sheppard, argued the development of this site should be viewed in the context of the future development of the centre, including the potential future development of the abutting service station site on the corner of Alma and St Kilda Roads up to a height of 11-13 storeys. It was argued the potential for this height takes its cue from the 13 storey Maxx development on the southwest corner of Alma Road and St Kilda Road.
3. We accept that it is appropriate to consider the potential future streetscape character given this site and activity centre is in a moderate change area which has the capacity for change. This is despite the policy reference to "existing streetscape" character. We also accept that it may be possible for the petrol station corner site to have a building height that is similar to the Maxx development. However, the review site has other abuttals that we find tempers its development potential.
4. Both the topography and streetscape character around this site differ from the area where the Santorini and Maxx developments are located. The width of St Kilda Road and the planted tramway median strip in its centre both serve to further divorce the two halves of the intersection. When questioned, Mr Govenlock's opinion was that allotments on the northern side of Alma Road in the business zone may potentially be developed to 5 or 6 storeys, despite being encumbered by a Heritage Overlay. We are not persuaded of the likelihood of this occurring. The eastern section of Alma Road surrounding this site and extending further east has lower scale buildings that are generally residential in nature, some of which are affected by a Heritage Overlay. We consider the characteristics of this site's particular location temper the potential building height on it.
5. Urban structure and character objectives at clause 21.05-2 seek to ensure that new higher density development is responsive to the existing scale and form of neighbouring sites[5]. It is clear that the immediate Alma Road context, once that of fine Victorian and Edwardian houses and multi-unit dwellings has, to a large degree, been overtaken by more pedestrian flat development. However, the overall two storey scale of the remaining mansion houses is equivalent to the three storey flat developments which constitute (to a large degree) the southern side of Alma Road between Chapel Street and this site.
6. The large RDNS building immediately to the east of the site demonstrates a design at the lower end of commercial development and adds nothing to the neighbourhood (a point agreed to amongst the parties). Nevertheless, we can envisage that this residentially zoned property will in turn be redeveloped in the future. It is possible to contemplate a building of up to 4-5 storeys on part on the RDNS site, but we are not persuaded it would reach the 6-8 storeys suggested by Mr Govenlock. Neither do we accept that the lack of height controls supports taller buildings as of right in this location.
7. Having considered the context of this site and the development potential of those surrounding it, we think it may be possible to achieve a 4-5 storey maximum building height on the RDNS site and a 11-13 storey building on the corner petrol station site. We are not persuaded there is likely to be any significant change in height on the north (opposite) side of Alma Road due to the Heritage Overlay. In light of this and the policy context, we are not persuaded a building height of 11 storeys is acceptable on this site.
8. Due to the lack of any clear guidance in the policy framework of the planning scheme, we have decided to express an opinion about the building height we think this site could support. We are of the opinion that a building of around 8 storeys may be an acceptable transition in height between future development along St Kilda Road and the adjacent residentially zoned hinterland. Even at this height it would be necessary to recess the upper levels.
9. In reaching this conclusion we have also considered the impact of the building as one travels west along Alma Road, where the entire east face of the building would be clearly visible. In longer views it is also possible to see the Santorini apartments, and some of the partially built Maxx apartments as background elements. The church spire at the corner of Barkly Street is also conspicuous, due to the road alignment. In terms of the character of the section of Alma Road in the locality of the site, we consider that an 11 storey building is not an acceptable design outcome. Scale is most certainly an 'amenity value' within the immediate neighbourhood, and as such the Planning Scheme seeks to protect it.
10. We reiterate that the acceptability of an 8 storey building is simply our opinion. Ultimately, any new development of this site will need to be assessed on its merits having regard to the policy and physical context that exists at that time.

1. Mr Schemnitz was quite critical of the detail of the design, describing it as appearing as an office building rather than a residential building. Mr Govenlock disagreed stating an office building would have had a predominantly glass façade, whereas this building breaks up the façade by the solid treatments to much of the balconies. Mr Sheppard stated the photo montages prepared by Orbit Solutions do not do justice to the design. To explain this, he pointed out the dark colouring of the upper levels does not correspond with the materials contained in the architectural drawings, which would be a grey metal colour. Mr Sheppard said that the materials of the building provide interest and articulation through the banding, as well as through the vertical split. Having reviewed the application design drawings and photomontages, we also have difficulty in accepting Mr Sheppard's evidence that the building above the first two floors is divided into 'two distinct forms' utilizing differing balcony treatment and finishes which will 'effectively break up the apparent mass' of the building. It appears to us that the approximate two metre 'fracture' formed by recessing the access corridor above the podium is ineffective in achieving this aim, and will be read only by those closely proximate to it. The splitting of the building is lost in many views. From both the east and the west along Alma Road it is not apparent.
2. It is the view of the building from the residential areas to the east of it which concerns us most. The 8 storey section is designed in a way which gives the impression of seeking to dominate its 2-3 storey surroundings, rather than live amongst them. The heavy serpentine balcony balustrades emphasise the bulk and weight of the building. Despite a setback of three metres from the eastern boundary, the higher "top" portion of the building appears to loom over the lower portion. Rather than providing interest, it seems to us that the selection of materials and the banding further contribute to the alienation of the building from its broader context.
3. We accept that the building is designed with the lower two floors forming a podium and a horizontal street edge aligning with the height of the RDNS building. As we have acknowledged this property is a candidate for redevelopment too, we feel the gesture seems somewhat irrelevant.
4. The contemporary architectural treatment of the building was accepted by Council, but objected to by some of the residents. Ms Bonazzi, Mr Schemnitz and Mr Tremaine described the design of the proposal as "brutal", "coarse" and "clumsily articulated", appearing as a commercial premises rather than a residential development. As noted above, we agree with them that the design of the external skin of the building serves to reinforce the appearance of visual bulk. The treatment of much of the building is repetitive and heavy in appearance, serving to emphasise the disproportionate size of the building rather than delineate the mass into smaller less visually intrusive elements.

1. Off site amenity relating to overlooking and overshadowing will be a matter for consideration in any future proposal. We simply note that the apartments at the rear of 174 St Kilda Road are located within a business zone and form part of the activity centre. Given activity centres are locations where change is both anticipated and expected, amenity expectations must be moderated. This does not mean that amenity impacts can be ignored. Rather that lower standards are acceptable where there is already a lower amenity by virtue of the apartments being behind and above commercial premises in an activity centre, and in this case on St Kilda Road.
2. There were a number of submissions from Council and residents living nearby about the unacceptability of the visual bulk of the proposed development. We have commented on this in our findings on the architectural detail and, obviously, any new proposal will require a new assessment of its merits in regard to visual bulk.

1. Whilst we find that the internal planning of the apartments is generally acceptable, a number of amenity issues were raised at the hearing which should be considered in any new proposal. These include failure to maximise the number of north facing apartments; limitations to the daylight available to lower units on the west and their acoustic separation from the noise and 24 hour operation of the adjacent service station; and the need to have sufficient setbacks from the west boundary to provide an equitable spread of development potential between the two properties and a suitable level of internal amenity to the apartments.

1. The proposal contains both residential and office car parking. In both cases, the standard car parking rates in the planning scheme are what should be provided for this proposal in the first instance. If an Applicant wishes to reduce or waive this requirement, it is incumbent upon the Applicant to justify this. As this building is over 4 storeys in height, the residential car parking requirements of clause 55 (commonly known as ResCode) do not apply and, instead, it is the standard car parking rate in the planning scheme of 2 car spaces per dwelling. The standard car parking rate in the planning scheme for an office is 3.5 car spaces per 100sqm of floor area. The standard car parking requirements are inclusive of visitor car parking.

1. In this case, the Applicant is relying upon the evidence of Ms Dunstan, who provided an expert report, gave oral evidence and was subject to cross-examination. Mr Tremayne was complimentary of the comprehensive nature of Ms Dunstan's expert report, and we agree. The Tribunal recently commented on the role of empirical analysis in determining whether a reduction or waiver of car parking is justified[6], and we consider Ms Dunstan's evidence provides a thorough analysis, taking into account a vast range of factors. All of these factors have assisted us in considering the appropriateness of the proposed car parking provision.

1. Ms Dunstan placed emphasis and weight upon the car parking rates contained in a report prepared by Ratio Consultants for the Council in 2007. This report analyses what reductions in car parking rates could be supported for a range of land uses, including residential and office land uses. Mr Beard stated this report has been adopted by the Council, but Council resolution provided to us during the hearing indicates that various rates were "noted" and would be considered subject to a range of criteria. It is clear that the intent of the Council's resolution was to pursue either a planning policy on reduced car parking or a schedule to the car parking clause in the planning scheme. Neither of these options has yet been pursued by the Council.
2. This report appears to be used by the Council in an adhoc manner. Ms Dunstan acknowledged this and talked about her own experiences where, for example, the Council has applied it in South Melbourne but not Port Melbourne. She also mentioned (almost as an aside comment) that it is possible not all of the Council's traffic engineers know about this policy. This comment was made when we asked why the Council's traffic engineer had applied an alternate office car parking rate in its assessment in the officer's report. Ms Dunstan did highlight that the Council had referred to this report in considering the 13 storey Maxx development on the other side of St Kilda Road.
3. Given the adhoc nature in which the Council is applying these reduced rates and the reasons why the report has been adopted by the Council, we have decided to give limited weight to this report in our consideration of the car parking provision.

1. The proposal is seeking a reduction from 3.5 office spaces to 2.0 spaces per 100 square metres of floor area. Ms Dunstan stated 2.0/100sqm is well accepted by the Council, but we note the Council's traffic engineer suggested 2.8/100sqm should be provided. Ms Dunstan stated the rate of 2.0/100sqm is consistent with the Council's Ratio report, however we note this report suggests differing rate ranges dependent upon whether the proposed spaces are shared or unshared. Ms Dunstan has no concern about the shared/unshared status of these car spaces. Rather, it is her view the reduced rate is appropriate for the following reasons:
   • the site's location within close proximity to a major employment precinct (St Kilda Road) and the excellent availability of convenient and efficient public transport in this area,
   • mode of travel statistics for work-based trips for this area show low levels of private car usage,
   • encouragement of 'local living' in this centre (i.e. working and living in the area by co-locating higher density employment and residential uses), and
   • support of sustainable transport initiatives, which include ample bicycle parking and end-of-trip facilities.[7]
2. Ms Dunstan also said a reduction is appropriate because the nearby on-street parking is restricted to short-term parking so that any additional office parking demands are unlikely to impact on the availability of this parking for visitors to the area. She said an office is one land use that is particularly conducive to achieving a mode shift away from private cars to public transport, cycling, walking, etc. We agree with Ms Dunstan's evidence that it is appropriate to allow a reduction in the office car parking.

1. The proposal is seeking a reduction from 2.0 to 0.73 spaces per dwelling. Ms Dunstan acknowledged the Council's Ratio report suggests a rate of 0.8 spaces per dwelling, but pointed out it also contains criteria to reduce the rate to zero. Given that we have already determined to give little weight to this report, we are not persuaded the provision of 0.73 spaces per dwelling is justified on this basis.
2. Ms Dunstan also provided car ownership data from the 2006 Census about the average number of cars per dwelling within the St Kilda postcode (including St Kilda, St Kilda South and St Kilda West). Bedsits have an average of 0.4 cars per dwelling, one bedroom apartments have an average of 0.8 cars per dwelling and two bedroom apartments have an average of 1.1 cars per dwelling. Ms Dunstan stated these statistics confirm that a reduced level of resident parking is appropriate for the site. We agree with this in general terms, but are not persuaded by the statistics that the provision that is proposed is appropriate.
3. The proposal is to provide 0.73 car spaces per studio, one and two bedroom dwelling, which equates to 59 spaces to 83 dwellings. We do not support this car parking provision for the two bedroom dwellings and the statistics cast some doubt upon the appropriateness of the provision of the one bedroom dwellings. We suggest that the Applicant and the Council will need to consider further what an appropriate residential car parking provision should be as part of any new permit application.

1. Ms Dunstan has assessed the provision of visitor car parking because it is a separate criteria that would be considered in clause 55, although she observed that the standard car parking residential rate is inclusive of visitor car parking. This proposal would generate a visitor car parking rate of 0.12 spaces per dwelling, which is less than the clause 55 requirement of 0.2 spaces per dwelling. Ms Dunstan stated 0.12 visitor spaces is a rate well accepted by Councils and the Tribunal, and we requested that she elaborate on this.
2. Ms Dunstan explained this rate was first identified in surveys undertaken by Cardno Grogan Richards in 2003 and November 2010 of two residential developments in Beacon Cove and South Yarra. It found a rate of 0.06 visitor spaces during the day and 0.12 visitor spaces in the evenings and weekends. Ms Dunstan provided a list of VCAT cases where the rate of 0.12 visitor spaces has been considered by the Tribunal in residential developments. However, she acknowledged that does not mean this rate of visitor car parking will always be appropriate.
3. We asked Ms Dunstan whether the site's proximity to public transport would be a determinative factor in applying a reduced visitor car parking rate. She expressed the view this is less relevant than the proximity to a range of services and facilities and the type and size of the dwelling/household. She explained, for example, a small studio, one or two bedroom apartment household is more likely to go out with visitors due to the small size of the apartment. Whereas a three bedroom apartment or a townhouse is more likely to have visitors coming to the dwelling. Hence, we accept her opinion that a visitor parking rate of 0.12 spaces per dwelling is appropriate in this instance as:
   • this proposal predominantly contains bedsits and one and two bedroom dwellings in an apartment style development; and
   • there is a range of services and facilities within walking distance.

1. Ms Schween expressed concern about the impact of the development upon the car parking and traffic associated with the adjoining office use, being the Royal District Nursing Service. She explained this building is RDNS' head office that contains primarily administrative staff as well as providing education and training to its 18-20 district offices. This means that in addition to the staff based in this building, there are a lot of visiting staff from the district offices. There is car parking provided below the building as well as an open rear car park that can be used by visiting staff. At the encouragement of RDNS vehicles enter the laneway to travel to the rear of RDNS to park and then exit via the RDNS driveway to Alma Place.
2. We are persuaded by Ms Dunstan is evidence that it is appropriate to use the laneway as the principal point of access into and out of this site. We agree that the collection of waste from the site can be appropriately controlled through a waste management plan that is prepared to the satisfaction of the Council. We acknowledge the number of vehicles and persons associated with the activities at RDNS that utilise the laneway, but it is a public road and can and should be used for access by the properties that have the benefit of it, including this site. If there are any safety or traffic hazard issues associated with its future usage, the property owners can discuss with the council whether traffic management measures need to be put in place. The concerns of RDNS are not sufficient reason to refuse this application.

1. We find the proposed building height of 11 storeys is not acceptable having regard to the planning policy context and the physical location of the site and the characteristics of the surrounding area. We are of the opinion that the development potential of this site in a moderate residential growth area needs to be tempered because of the streetscape character, particularly of Alma Road. We share some of the residents concerns about the architectural detailing of this proposal. Any new planning application will need to be considered on its own merits having regard to the suitability of its height, form, architectural detail and external and internal amenity impacts. A reduction in the provision of car parking for both office and residential land uses is appropriate, but the proposed provision in this application for the residential apartments is not appropriate based on the evidence and material before us.
2. For these reasons, we have decided to refuse this planning application and order that no permit be issued.

[1] A section 79 failure application for review is deemed to be a refusal of the application by the decision maker (the Council) pursuant to section 4(2)(d) of the Victorian Civil and Administrative Tribunal Act 1998.

[2] Extracts from clause 21.06-6, Local Strategies for St Kilda Junction/St Kilda Road South Business 2 Zone at page 24 of 27

[3] The St Kilda Road Business 2 Zone is specifically identified as forming part of the moderate residential growth area in strategy 1.1 of clause 21.04-1 of the MSS

[4] As identified on pages 2 and three of clause 21.04

[5] Objective 8 with strategy 8.1 "Achieve a graduation in building scale and massing between areas of medium and higher density development within activity centres, to the traditional low-rise, fine grain scale of established residential areas" and strategy 8.2 "Ensure that new development at increased densities provides a transition in scale to any adjoining lower-rise development".

[6] Refer to E A H Batman Pty Ltd v Melbourne CC (includes Summary) (Red Dot) [2011] VCAT 1477

[7] Extract from section 5.1.4.2 of Ms Dunstan's evidence