The decision of the responsible authority in relation to Planning Permit Application No. 779/2202/B is set aside.

A permit is granted and the responsible authority is directed pursuant to section 85(1) Planning and Environment Act 1987 to issue a permit amending Permit No 779/2202/A for the land at 135 Inkerman Street, St Kilda.

Development and use of the land at 135 Inkerman Street, St Kilda for 2 buildings (one 4-storey, one 5-storey) with basement and ground level car parking (135 spaces) for 98 dwellings, office and retail floor space and dispensation of the car parking/loading bay requirements of the Port Phillip Planning Scheme with the following changes:

(a)

Increased retail and office floor space (101.5m² and 616.5m² respectively).

(b)

Four additional dwellings (from 98 to 102).

(c)

Consolidation of two separate car park entries to one access on the east side of the site and additional parking (from 134 to 163).

(d)

Addition of solid wall on south boundary.

(e)

Deletion of seven apartments on ground level.

(f)

Additional mezzanine car park level above ground floor.

(g)

General alterations and additions, internal and facade modifications.

(h)

Addition of conditions 1(n) to 1(r).

(a)

An increase in the retail floor space from 431.5m2 to 1493m2 for Aldi supermarket.

(b)

Replacement of the 170m2 speciality shop on the eastern side of the frontage with a lobby for the residential units.

(c)

Deletion of the office floor space.

(d)

A reduced rate of car parking for the additional retail floor space proposed (total 172 spaces proposed overall).

(e)

Minor changes to the Inkerman Street facade and car park layout.

(f)

Provision of a loading bay of 126m² along the western boundary of the site with access from Inkerman Street.

(g)

Additional conditions 1(s) to (x) and 27 to 32 set out below.

It is directed that the permit be subject to the following conditions:

1 Before the development starts, amended plans to the satisfaction of the Responsible Authority must be submitted to and approved by the Responsible Authority. When approved, the plans will be endorsed and will then form part of the permit. The plans must be generally in accordance with the submitted plans but modified to show:

(a)

A schedule of colours, materials, finishes and textures to the satisfaction of the Responsible Authority.

(b)

Functional, integrated and contextually appropriate urban art, able to be appreciated from the public realm to the satisfaction of the Responsible Authority.

(c)

Proposed location of retail and building identification signage.

(d)

Variety to the parapet height, alignment or materials, possibly related to the room type or fenestration below to the satisfaction of the Council's Manager, Urban Design and Architecture.

(e)

Full details of screening devices to prevent overlooking between the balconies and terraces of residential units within the site whilst continuing to allow horizontal and upward views.

(f)

Incorporation of the recommendations of the energy rating report.

(g)

Details of siting of solar panels, building plant and equipment, any satellite dishes and or plumbing.

(h)

Details of acoustic treatments to the south wall and associated windows and doors to protect the units' residential amenity from noise from adjacent non-residential uses, in accordance with a report prepared by an acoustic engineer to the satisfaction of the Responsible Authority.

(i)

Provision of communal facilities in the resident first level courtyard area.

(j)

Any residential reserved car spaces in the ground level car park secured from other users of the development.

(k)

A car park control point placed a minimum of one car length (6 metres) inside the property line to serve the basement level car park.

(l)

Bollards or other suitable separation devices placed at the entrance to the foyer at the elevated podium level to provide protection to pedestrians exiting the foyer into the car park.

(m)

Provision of a storage area to each unit.

(n)

The accessway to the basement car park to incorporate the flood proof apex of a minimum of 300mm above flood level or other measures of preventing flooding of the basement.

(o)

Deletion of the western crossover and the kerb and footpath shown to be reinstated.

(p)

The louvres attached directly to the windows setback 3m from the western boundary so as to be less intrusive on the property to the west.

(q)

Retention of existing vegetation on the western boundary.

(r)

Terraces to Units 129, 131 & 133 & 135 reduced in width to 2m and the planter boxes adjacent to these units set into the headroom of the basement car park below.

(s)

Provision of six additional car parking spaces in the residential car park, and conversion of six residential car parking spaces to publicly accessible car parking spaces.

(t)

The provision of 38 bicycle parking spaces and associated shower and change facilities in accordance with c1.52.34 of the Port Phillip Planning Scheme.

(u)

Provision of garbage facilities adequate for all uses on the site including the supermarket.

(v)

A designated "no standing" zone west of the proposed crossover and modified crossover to provide for the "sweep path" of a 10m long rigid truck as shown in the diagram attached to the Ratio Traffic Impact Report March 2006.

(w)

A retail tenancy shown as the lobby/reception for the serviced apartment component of the proposal.

(x)

Provision of a loading by of 126m² along the western boundary of the site with access from Inkerman Street.

2 The use, development and design as shown on the endorsed plans must not be altered without the written consent of the Responsible Authority.

3 This permit will expire if one of the following applies:

(a)

The development and use is not started within 2 years of the date of this permit.

(b)

The development is not completed within 2 years of the date of commencement of 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.

4 The Applicant/Owner shall do the following things to the satisfaction of the Responsible Authority:

(a)

Pay the costs of all alterations/reinstatement of Council and Public Authority assets necessary and required by such Authorities for development;

(b)

Obtain the prior written approval of the Council or other relevant Authority for such alterations/reinstatements;

(c)

Comply with conditions (if any) required by the Council or other relevant Authorities in respect of reinstatement.

(d)

Construct all necessary vehicle crossings and demolish all unnecessary vehicle crossing in accordance with plans and specifications first approved by the Responsible Authority.

5 All external lights must be of a limited intensity to ensure no nuisance is caused to adjoining or nearby residents and must be provided with approved baffles, so that no direct light or glare is emitted outside the site.

6 Prior to the occupation of the premises for the new use, areas set aside for parked vehicles, loading bays and access lanes as shown on the endorsed plans and approved engineering plans must be:

(a)

Constructed to the satisfaction of the Responsible Authority.

(b)

Properly formed to such levels that they may be used in accordance with the plans.

(c)

Surfaced with an all weather seal coat to the satisfaction of the Responsible Authority.

(d)

Drained and maintained to the satisfaction of the Responsible Authority.

(e)

Line marked to indicate each car space, loading bay and all access lanes in accordance with the endorsed plans to the satisfaction of the Responsible Authority.

7 Landscaping must be undertaken in accordance with the ERM Drawing No. LS1 dated June 2002 and shall be completed before the building is occupied. All landscaping must be maintained to the satisfaction of the Responsible Authority.

8 The landscaping plan prepared by ERM must be modified by inclusion of communal facilities in the residential courtyard.

9 All piping and ducting shall be concealed unless otherwise approved by the Responsible Authority.

10 No equipment, services and architectural features other than those shown on the endorsed plan shall be permitted above the roof level of the building unless otherwise agreed to in writing by the Responsible Authority. No more than three television antennae shall be erected within the perimeter of the site.

11 No polluted and/or sediment laden runoff is to be discharged directly or indirectly into Melbourne Water's drains or watercourses.

12 Finished ground floor levels of proposed buildings must be a minimum of 300mm above the applicable flood level.

13 The entry/exit driveways of the basement car parks shall incorporate a flood proof apex of a minimum of 300mm above flood level or the measures of preventing flooding of the basement to the satisfaction of Melbourne Water.

14 The basement drainage system is to be constructed so that external flooding is unable to penetrate the basement area. Vents, staircases and lift voids are not allowed to act as floodwater inlets to floor levels below the flood level.

15 Upon completion of the works, a certified survey plan, showing levels reduced to the Australian Height Datum, must be submitted to Melbourne Water to demonstrate that Melbourne Water's conditions have been satisfied.

16 The car parking allocation used in any Plan of Subdivision for this development shall:

(a)

include not less than 1 car space per single bedroom apartment

(b)

2 car spaces for 3 or more bedroom apartments

(c)

visitor spaces (as required in the assessment) shown and marked accordingly, and

(d)

the remainder of car spaces allocated for the 2 bedroom apartments provided each unit has at least 1 car space.

All car parking spaces for the residential apartments shall be shown on any Plan of Subdivision as part lots to the dwelling lots.

17 Any air-conditioning plant or equipment shall be obscured from a public view to the satisfaction of the Responsible Authority (this includes placement of any air-conditioning equipment on balconies which are partially obscured by the front glazed feature).

18 The entry/exit gates and intercom facility shall be installed prior to the occupation of any dwelling and must be maintained to the satisfaction of the Responsible Authority.

19 Before construction commences, the applicant shall provide to Council a copy of either:

(a)

A certificate of Environmental Audit in accordance with Part IXD of the Environment Protection Act 1970, or

(b)

A statement from an environmental auditor appointed under the Environment Protection Act 1970 in accordance with Part IXD of that Act, that the environmental conditions of the land are suitable for a residential use.

20 Provision shall be made for the storage and disposal of garbage to the satisfaction of the Responsible Authority. All garbage storage areas must be screened from public view.

21 A garbage and waste recycling plan shall be produced to the satisfaction of the Responsible Authority to be endorsed and form part of this permit. The plans shall include requirements for the body corporate building manager to manage the movement and the caretaker employed by the building body corporate to manage maintenance of bins around site. All garbage and waste recycling shall be in accordance with the approved plans.

22 The developer shall pay for the removal costs associated with removal of the street tree and liaise with Council's Citywide Tree care for payment and scheduled removal date well before the intended removal date.

23 The colour of external cladding and trim of the proposed building shall be to the satisfaction of the Responsible Authority and all paintwork shall be satisfactorily maintained.

24 The amenity of the residential dwellings on the site must not be detrimentally affected by the commercial uses through the:

(a)

Transport of materials, goods or commodities to or from the land.

(b)

Appearance of any building, works or materials.

(c)

Emission of noise, artificial light, vibration, smell, fumes, smoke, dust, waste water or waste products.

(d)

Presence of vermin.

(e)

In any other way.

25 Any redundant cross-overs shall be made good to the satisfaction of the Responsible Authority and the kerb and channel reinstated.

26 This permit relates only to the use and/or development of the land and does not comprise an approval for the erection of any advertising signs. The location and details of any advertising signs to be erected on the land shall be the subject of a separate application.

27 The developer shall allocate 0.5% of the cost of development towards the implementation of urban art integrated into the buildings and works hereby permitted.

28 The loading bay must be closed off and screened from view except as required for the entry and exit of vehicles.

29 Deliveries and collections from the site must be limited to vehicles no greater than 14m in length.

30 The loading bay door must be designed of materials with acoustic qualities to prevent the escape of noise when closed.

31 Deliveries and collections from the loading bay (including garbage collection) must occur only

(a)

for vehicles up to 10 metres in length at any time except between the hours of 7am to 9am and 4pm to 6pm.

(b)

for vehicles 10 m up to 14 metres in length between the hours of 10am and 3pm.

32 Vehicles using the loading bay must commence their reversing manoeuvre from a position parallel to the southern kerb of Inkerman Street adjacent to the loading bay entry.

1 This is an application under s.77 Planning and Environment Act 1987 (PE Act) for review of a decision of Port Phillip City Council to refuse to grant a permit on Permit Application 779/2202/B to amend Planning Permit 799/2002/B for a mixed use development at 135 Inkerman Street, St Kilda to provide for a supermarket tenancy and loading bay.

2 The application for permit was lodged with council on 20 September 2005. Following the giving of notice of the application 49 objections to the proposal were received. The grounds of objection were summarised in the council officer's report.

3 There were no referrals pursuant to s.55 (PE Act) but the application was referred internally to council's traffic engineers, who concluded that:

•

The proposal is short of 21 visitor parking spaces. This shortage will have impact on the surrounding on-street parking supply/availability. Some of the proposed off-street parking spaces are substandard.

•

The loading dock is unsafe and unsatisfactory in terms of trucks to be required to reverse into the dock on a busy arterial road across a busy footpath.

4 Council considered the application and, consistent with its planning officers recommendation to refuse to grant a permit, determined to refuse to grant a permit on the following grounds:

1. The proposal is contrary to the objective of Melbourne 2030 and represents an out of centre development.

2. The proposal is contrary to the State Planning Policy Framework.

3. The proposal is contrary to the Local Planning Policy Framework.

4. The proposal would have insufficient car parking.

5. The proposal would lead to unsafe truck manoeuvring into the loading bay.

5 The application for review was lodged with the Tribunal on 6 January 2006 and the stated grounds for review rebut the grounds for refusal of the permit.

6 Except for Mrs Jones who made an oral submission, the parties' representatives that attended the hearing and the persons called to give evidence tabled and spoke to written submissions and witness statements. These, together with the plans, photographs and other material tabled in the course of the hearing, have been attached to the Tribunal's file.

7 The following persons gave expert evidence:

•

Mr Andrew Clarke of Matrix Planning Australia, Planning Consultant;

•

Mr Terry Hardingham of Andrew O'Brien & Associates, Traffic Engineer;

•

Mr Justin Ganley of Deep End Services, as to need and an economic impact assessment for an Aldi Supermarket;

•

Mr Jamie Govenlock of Urbis JHD, Planning Consultant;

•

Mr Norman Symons of Ratio Consultants Pty Ltd, Traffic Engineers;

•

Mr Michael Durkin of GTA Consultants, Traffic Engineers

8 The hearing of this application took 3 days. Following the hearing we inspected the subject land, the neighbourhood in Inkerman Street and St Kilda Road, the Carlisle Street Shopping Centre and the neighbourhood at large. We also inspected the new Aldi Supermarket in Franklin Street, Melbourne.

9 The site is located on the southern side of Inkerman Street, St Kilda with a frontage to Inkerman Street of 76.0m, a depth of approximately 48m with an overall site area of 3,650m². The site was previously occupied by a building and car park formerly used as bowling alley. The site is currently under construction in accordance with Planning Permit 779/2002A for the redevelopment of the site for 102 dwellings, retail and office floor space in two buildings of 4 and 5 storeys with 163 car spaces.

10 Land uses in the vicinity are mostly residential. Residential buildings are located on the opposite side and further to the north. To the east the site is abutted by a recently constructed 5 storey building with offices at ground level and apartments at the upper levels. Land further east comprises a mix of 1 and 2 storey attached and detached residential dwellings.

11 To the west the site abuts a funeral parlour and beyond that some commercial uses up to the old post office (now a community church), on the south-east corner of Inkerman Street and St Kilda Road.

12 The proposal is to amend permit 779/2202/A, which as it presently stands, allows the development and the use of the site for 2 buildings (one 4 storey and one 5 storey) with basement and ground level car parking, dwellings, office and retail floor space and a dispensation of the car parking/loading bay requirements of the planning scheme, with the following particulars:

•

Retail floor space of 431.5m²;

•

Office floor space of 1060m²;

•

102 dwellings;

•

consolidation of 2 separate car park entries to 1 access on the east side of the site;

•

total parking of 163 spaces;

•

addition of solid wall on south boundary;

•

other miscellaneous changes not relevant to this permit application.

13 The proposal sought an amendment to the permit as follows:

•

To increase the retail floor space to 1493m² for a supermarket plus a 170m² for speciality shop [at the hearing the applicant indicated it was prepared to replace the 170m² speciality shop with a lobby to the residential apartments];

•

Deletion of the office floor space;

•

A reduced rate of car parking for the additional floor space proposed (total 174 spaces proposed overall)[amended at the hearing to 172 spaces overall];

•

Minor changes to the Inkerman Street façade and car park layout.

•

Provision of a loading bay of 126m² along the western boundary of the site with access to Inkerman Street;

14 Whilst there was no change to the proposed use of the retail area as a shop the application was made on the basis that the indicated retail area of 1493m² was to be an Aldi Supermarket.

15 The land is in a Mixed Use Zone. The purposes of the zone are set out in Clause 32.04 and in addition to implementing the State Planning Policy Framework and the Local Planning Policy Framework are:

•

To provide for a range of residential commercial, industrial and other uses which complement the mixed use function of the locality.

•

to encourage residential development that respects the neighbourhood character.

16 Under Clause 32.04-1 a permit is required to use the land for the purposes of a shop. Consequently permission is required for the increase in retail floor space. Supermarket, whilst not separately defined in clause 74 is included in the definition of shop.

17 A permit is required under clause 32.04-7 to construct a building or carry out works for a section 2 use in the zone (ie. shop and associated loading bay).

18 The land is subject to an Environmental Audit Overlay and a Special Building Overlay not relevant to these proceedings.

19 A permit is required under clause 52.06 for a reduction in car parking requirements.

20 A permit is required under clause 52.07 of the planning scheme for the reduction or waiver of the loading and unloading provision specified in the clause.

21 Other provisions in the planning scheme referred to were as follows:

•

State Planning Policy Framework (SPPF) - clause 12 (Metropolitan Development) and in particular the provisions of clause 12.01-2 (Strategies - Activity Centres) in relation to neighbourhood activity centres and out of centre development.

•

Local Municipal Strategic Statement (MSS) and Local Planning Policy Framework (LPPF) - clauses 21.04-7, (Vision for East St Kilda) and the Strategic Land Use Framework Map, 21.05 and the Residential Land Use Framework Plan, 21.05-8 (Commercial Land Use) and the Commercial Land Use Framework Plan, 21.05-10 (Retail Land Use) and the Retail Land Use Framework Plan, 21.05-12 (Mixed Use Areas), 22.02 (Retail Centres Policy with particular reference to East St Kilda/Carlisle Street and Inkerman Street), 22.06 (Urban Design for Non Residential Development).

•

the provisions of clause 34.02 - Business 2 Zone.

•

The commercial Land Use Strategy 1996.

•

City of port Phillip Activity Centres Review, Draft, 2005.

22 Clause 65 of the Scheme sets out decision guidelines that must be considered, as appropriate, before deciding on any permit application under the scheme.

23 We have considered the submissions of the parties, the evidence of the witnesses, the documents and photos and material produced that are on the tribunal's file and observations made on our inspection of the area.

24 Whilst car parking adequacy was a ground of refusal, Mr Pitt advised that it is accepted that adequate car parking is able to be made available subject to the report and recommendations of Mr Hardiman. Also the applicant has agreed to provide the number of required bicycle parking spaces. The permit conditions provide for these modifications.

25 The remaining issues are:

•

Need and economic impact.

•

Is this location a suitable site for a supermarket in accordance with the planning scheme?

•

The adequacy of the proposed loading bay;

•

Amenity impacts on the neighbourhood.

NEED, ECONOMIC IMPACT AND NET COMMUNITY BENEFIT

26 Need and economic impact were not directly contested by council, but underlying council's submission was the reliance on the State and Local Policy provisions directing major retail activities into activity centres, and more specifically in the case of the City of Port Phillip's into retail activity centres on the grounds that Out-of-Centre Development would have adverse economic effects identified by Mr Clarke in his expert evidence as:

•

loss of the retail synergies that result from core retailing activities such as an Aldi Supermarket being located outside of the identified retail centres of Fitzroy, Acland and Carlisle Streets;

•

loss of the benefit of multi purpose trips to retail outlets in an identified retail activity centre;

•

loss of opportunity for increased activity in existing activity centre;

27 Mr Ganley gave evidence as to the nature of the Aldi Supermarket shopping operations describing their key characteristics as:

•

a general preference for a stand-alone format;

•

on site parking;

•

a limited number of product lines (750) compared to 2,000 for convenience stores and up to 30,000 for some ful line supermarkets;

•

predominance house brands lower priced than comparable national brands in other supermarkets;

•

no internal departments;

•

only a small number of fresh food items.

28 It was Mr Ganley's contention that it would be unusual for customers to carry out a full week shopping at Aldi Store. He put it to the Tribunal that Aldi catered for bulk buying on a small range of items and also for featured discount store goods which varied from novelty items to televisions or washing machines.

29 Mr Ganley stated that it was virtually impossible for Aldi to obtain a site which met their requirements within existing retail activity centres in the St Kilda area to achieve the benefits of co-location advocated by the council. There was some debate about whether adequate enquiries had been made to council as to site availability. Council's witnesses however did not produce any contrary evidence, and our tentative conclusion on inspection was that it would be extremely difficult to obtain a site for a stand alone Aldi Supermarket with adequate car parking in the Carlisle Street, Fitzroy Street or Acland Street retail areas.

30 Mr Ganley's analysis of the supermarket goods spending market focused on edible supermarket goods (ESG) which comprise almost 80% of supermarket sales in Australia. He confined his analysis to a primary catchment area within 3km of the subject land and a secondary catchment extending to 3.5km to the north, east and west.

31 There are two supermarkets in the identified catchment; Coles (2,615m²) and Safeway (1,520m²). Mr Ganley contended that these were both small by modern standards; a standard full line supermarket being at least 3,000m², and that the overall presentation of the stores was relatively poor, and parking was at a premium, with patrons competing with other users of Carlisle Street for spaces. Our inspection confirmed these observations.

32 Mr Ganley's analysis of the current ESG sales of the Carlisle Street supermarkets showed trading levels well in excess of the current Australian average which he attributed to an under provision of supermarket space in the catchment.

33 His figures also demonstrated that the major ESG retailers in the catchment area were capturing less than half of ESG spending originating in the catchment area, with the excess spending directed out of the catchment areas and to other smaller ESG retailers within the area.

34 He compared the forecast ESG sales of the Aldi supermarket of $7.2M, that is 3.6% of ESG sales in the primary sector reducing to 1% in the secondary sector and concluded the market share taken by the proposed Aldi would pose no threat to the local retailing community and would in no way undermine the fabric of the Carlisle Street activity centre given; the large local spending potential, the forecast growth of sales and the under supply of space.

35 He concluded overall that the development would have the following net community benefits:

•

creation of one off employment during the construction phase,

•

creation of on-going direct and indirect retail employment

•

increased choice, and price savings.

36 Mr Ganley's evidence is in contradiction to Mr Clarke's evidence regarding the fragmentation of the retail offer in the retail activity centres given they are booming and overcrowded. We find that there will be no impact on the viability of other traders in the catchment and no potential loss of the benefits of agglomeration and co-location such as shared use of car parking or fewer shopping trips. Customers, in our view, will be likely to use the Aldi supermarket as a convenience store, and will continue to do their major weekly food shopping elsewhere. We do not consider the location of the Aldi store will add in any significant way to the shopping kilometres per household.

37 We consider Mr Clarke's analysis failed to note the differences between the Aldi offering and mistakenly treated it as similar to the usual Coles, Safeway or IGA supermarket. It is quite a different offering with a much more limited and specialised range of products, offering significant price competition and an unusual range of 'specials'. Our assessment is that it would offer healthy price competition to the existing supermarkets for some items but generally cater for a separate market sector including single trip visits for stocking up on selected ESGs and for advertised non-food specials.

38 Accordingly we prefer Mr Ganley's evidence on net community benefit to that of Mr Clarke, specifically that the disbenefits identified by Mr Clarke are outweighed by the economic benefits of cheaper prices and employment opportunities.

IS THIS LOCATION A SUITABLE SITE FOR A SUPERMARKET IN ACCORDANCE WITH THE PLANNING SCHEME?

39 The principal issue raised by council was that the proposal was a core retailing activity and as such belonged in an Activity Centre with a strong retail function.

40 It was council's submission that there is no policy support for locating a supermarket in a Mixed Use zone on the periphery of a commercial area within a Business 2 zone. It was Mr Pitt's contention supported by the evidence of Mr Clarke that:

The focus for retailing is to be in the identified centres of Fitzroy Street, Acland Street and Carlisle Street where the retail synergies from core retailing can be achieved. This is also consistent with the designation of those areas as major Activity Centres and with their zoning as Business 1 rather than Business 2, far less mixed use.

41 Mr Gobbo's argument supported by the evidence of Mr Govenlock was that the:

a. The subject site is conveniently located for a small, limited-line item, specialist store serving a real local need such as Aldi;

b. That the Mixed Use Zone was appropriate for a supermarket and there was no specific policy within the planning scheme which would discourage the establishment of retail use per se within the zone.

42 There was no dispute between the parties that in the new VPP based planning systems the exercise of discretion should be heavily influenced by the Strategic and Planning Policy Framework.

43 The Tribunal in SMA Projects v Port Phillip City Council[1] adopted a number of statements as to the correct approach to the application of policy as follows:

•

Policy can never be more than a guideline, it should not be applied as if it is a mandatory limitation on the exercise of discretion provided for by the scheme.

•

Policy must be considered in a framework which includes all the policies relevant to a proposal in the scheme.

•

Policy should not be applied in a way which leads to a result which is inconsistent with a proper analysis of the evidence.

•

The planning reform process was intended to result in a system that was capable of producing good or preferred outcomes and that policy should not constrain a decision-maker into accepting something less than the best decision in each case.

44 Similar comments are found in Doncaster Road Property Partnership v Manningham City Council[2] and by the Court of Appeal in Whitehorse City Council v Golden Ridge Investments Pty Ltd[3].

45 Mr Pitt relied on the concept of core retailing enunciated in Azzure Investments Pty Ltd v Port Phillip City Council[4].

46 In this case a proposal for a full line supermarket of 3,368 square metres at ground level in City Road, South Melbourne in a Mixed Use zone, was rejected, a principal reason being that the site was not in an Activity Centre and council relied on the Retail Centres Policy at clause 22.02.

47 However the Tribunal also adopted three propositions as fundamental:

•

Core retailing belongs in a Business 1 zone.

•

Core retailing belongs in the heart of an Activity Centre, not on its periphery or beyond.

•

Core retailing where it can create valuable synergies with other associated uses, where it can be integrated physically, visually and functionally with the rest of the centre and where it can promote pedestrian accessibility and connection.

48 The Tribunal in that case determined that a full line supermarket is a core retail activity that belongs where it can create synergies with other associated uses and therefore contributes to the functionality and vitality of an Activity Centre, and that, consistent with Melbourne 2030, a location that fails to integrate with the layout and structure of an Activity Centre is to be avoided. A standalone facility is an outcome very much discouraged by the Planning Policy Framework and one which the Tribunal did not consider would contribute a net community benefit.

49 However the concept of core retailing has been subject to criticism. In Glenwaye Pty Ltd v Glen Eira City Council[5] the Tribunal constituted by a deputy president and a senior member rejected the concept of a distinction between core retailing and non-core retailing at paragraph 71. At paragraphs 107 through to 118, this Tribunal undertook a lengthy discussion of the distinction sought to be made between core and non-core retailing and commented at paragraph 109:

Retailing is a genie that keeps escaping from the statutory planning bottle. No sooner are current retail practices nailed into a set of planning scheme definitions, than retail practice tends to take off in new directions making current definitions inadequate. This is evidenced by the struggle that statutory planning has had with restricted retail premises (formerly peripheral sales), big box retailing and now the growth of discount bargain department stores such as The Warehouse Group.

50 At paragraphs 115 and 116 the Tribunal also said:

In our view, any move to introduce such a distinction into the planning scheme by way of policy is fraught with difficulty, ambiguity and potential conflict. We find there is no strategic basis behind it. It flies in the face of contemporary practice and trends in the retail industry and it has no statutory basis. In our view, such distinctions should only be introduced by way of changes to definitions in the planning scheme after rigorous analysis and as part of an open, transparent process.

With respect to the current proposal, we find that it is not possible to categorise the proposed consideration of shop types as core or non-core retailing in any meaningful way. Ultimately, it is not a helpful exercise either as the weight of other planning policy for activity centres and urban villages supports this type of use and development and draws no distinction between sub-categories of shop in this type of location.

51 Accordingly we consider that this decision indicates that a distinction between core and non-core retailing cannot be relied upon with any certainty and we conclude that it undermines the basis of the proposition in Azzure Developments relied upon by Mr Pitt, which in any case related to a full line supermarket in excess of 3,000 square metres and not a limited line Aldi store.

52 Mr Govenlock addressed the issue whether the site forms part of an Activity Centre. He noted that the definition of an Activity Centre in Melbourne 2030 did not make a distinction between Retail and Commercial Activity Centres although it acknowledged that there are different Activity Centres with different roles and functions.

53 Council's position at the hearing was that the site is not part of an Activity Centre and the development is therefore an out-of-centre development.

54 Mr Govenlock disagreed and took the view that the Inkerman Road precinct containing the site would fit comfortably within the definition of a Neighbourhood Activity Centre.

55 We agree with Mr Govenlock's conclusion that the site forms part of an Activity Centre which extends predominantly north and south along St Kilda Road and along the south side of Inkerman Street because of the following features:

•

there is a mix of retail, commercial, entertainment and community centres;

•

the centre contains a high density housing and a variety of housing stock generally;

•

the Activity Centre is located on the principal public transport network on St Kilda Road and close to a similar network on Chapel Street;

•

the centre is walkable and well connected to its user population principally to the east.

56 Mr Govenlock emphasised that Melbourne's Activity Centres have been identified as being at the forefront of change over the next twenty years with the first wave of change being the development of multi density apartment and mixed use developments.

57 The next proposition considered by both consultants was whether the proposal was appropriate for the site. Mr Clarke was ambivalent in that he acknowledged the site does have some attributes making it suitable for a small supermarket including its size, car parking provision, adequate access and loading facilities. Further the site is flat and is relevantly convenient to the tram routes in St Kilda Road and Chapel Street and the buses in Inkerman Street. Mr Clarke's main reason for finding the site unsuitable was the absence of the ability to create synergies from an agglomeration of like retail and associate uses. The site, in his view, was disadvantaged by not being located on the fringe or periphery of an existing Activity Centre containing complementary uses nor located on a pedestrian through-route between two Activity Centres.

58 Mr Govenlock submitted that whilst the council's local policies encourage retail to be located in Retail Centres, it does not directly discourage the contrary.

59 We place particular emphasis on the evidence that this is not a large retail outlet, that it is part of a mixed use development with a very substantial residential component. The existing permit already provides for more than 400 square metres of retail activity. What is proposed here is an expansion in the retail area by just over 1,000 square metres to accommodate a small supermarket which cannot in any sense be compared with the full line supermarkets in Carlisle Street or elsewhere in the retail centre.

60 The last of council's grounds of refusal was that the proposal would lead to unsafe truck manoeuvring into the loading bay. Council's traffic engineers comments were as follows:

Inkerman Street is a busy arterial road that carries 15,000-16,000 vehicles per day. We do not allow installations of new cross-overs if vehicles cannot enter and leave the site in the forward direction. It is irresponsible to allow a loading bay for a supermarket that can only be accessed by reversing trucks. I cannot accept the one paragraph from Ratio suggesting that impact on traffic from reversing of a 12 metre truck will be minimal on a road like Inkerman Street. Also impact on pedestrian safety is seen to be adverse with the proposed loading zone. With the proposed supermarket, there will be more people walking along this footpath and it is seen unsafe to allow a truck to reverse over the footpath. (It may have been ok, or on the border line to allow this loading dock for offices that would require less deliveries by smaller trucks than for the supermarket that will use larger trucks and more deliveries).

61 Council's delegate report regarded this as a fatal flaw.

62 The wording of clause 52.07 with respect to loading bays requires a permit to reduce or waive the requirements to be met as set out in the clause. In any event Mr Hardiman, Mr Symons and Mr Durkin agreed these requirements were met for the proposed design in that:

•

Space is provided on the land for loading and unloading as specified in the table to the clause;

•

The driveway to the bay is at least 3.6m wide;

•

The road that provides access to the loading bay is at least 3.6m wide.

63 Therefore it appears no permit is needed to waive these requirements. The loading bay issue therefore comes down to a traffic and amenity issue because of the need for trucks to reverse in.

64 Mr Symons' and Mr Durkin's evidence was that Aldi would service the site with rigid trucks up to 10m long, and on occasions semi trailers up to 14m long. The adjacent part of the Inkerman Street kerb will also be available for a van or a small truck parking and deliveries.

65 The applicant agreed to permit conditions restricting deliveries to the loading bay so that:

•

deliveries by the 14m vehicles are limited to between 10.00am and 3.00pm; and

•

deliveries bay by the 10m rigid trucks cannot be made between the hours of 7.00am - 9.00am, 4.00pm - 6.00pm.

66 Mr Hardiman's evidence was that the planning scheme provided no guidelines to real world loading needs and referred to the VicRoads Guidelines. In his opinion it was likely that Aldi and other supermarket operators would prefer to use 19 metre long semi trailers for deliveries and would not accept restrictions to 14m. This belief is, in the light of the applicant's evidence no longer applicable.

67 Mr Hardiman's criticism of the loading area was that whilst it complied with the requirements of the planning scheme in terms of spatial provision, from a traffic impact and road safety perspective its location requires trucks to stop on the incorrect side of a secondary arterial road that carries at least 11,000 vehicles per day, and then reverse into the loading bay, causing all traffic to stop and the possibility of rear end crashes, with unacceptable adverse safety implications.

68 He considered that a greenfields site approach requiring forward ingress and exit was desirable. Mr Gobbo responded that the current building design would not allow a redesign to achieve this, and that in this inner city location this approach was a wasteful and unnecessary use of scarce land resources.

69 Mr Symons and Mr Durkin tendered diagrams which showed that 10m rigid trucks and 14m articulated trucks could reverse into the loading bay provided and not impede passing vehicular traffic or encroach into the east bound carriageway subject to some minor widening of the crossover.

70 Mr Durkin was of the view that further benefit could be obtained by designating a small section of on-street car parking fronting the site immediately east of the loading crossover as a loading zone.

71 Mr Symons referred to many situations throughout Melbourne especially in strip shopping centres where supermarkets require delivery trucks to reverse into loading bays off major roads, for example the Coles Supermarket in Doncaster Road, North Balwyn and the Safeway Supermarket in Jasper Road, Bentleigh, both much larger than the proposed Aldi supermarket..

72 Mr Durkin surveyed the frequency and duration of gaps in the traffic stream created by the adjoining signalised intersection of Chapel Street and St Kilda Road, and that the average number of gaps sufficient to allow a truck to reverse into the site (20 seconds or greater) occurred on average 45 times per hour and accounts for 64% of the time. He further found the minimum number of times a gap of 20 seconds or greater occurred was 21 times per hour and that the available gaps were distinctively less than in off-peak times.

73 The survey also analysed queuing over or past the subject site driveway during peak times and found the driveway is blocked 22% of the time between 8am and 9am and 14% of the time between 5pm and 7pm.

74 Mr Durkin concluded that the loading arrangements as proposed were satisfactory subject to the restrictions in delivery times already mentioned together with the designation of a loading zone immediately to the east of the loading crossover.

75 We accept the evidence put on behalf of the applicant and find the loading bay arrangements are satisfactory subject to the recommendations made in Mr Durkin's submission outlined above.

76 Amenity impacts were not heavily relied on by council. Mr Clarke did not consider there would be any significant amenity issues raised between the residential land uses along both sides of Inkerman Street, light industrial uses to the site's rear and the proposed supermarket

77 The aspects of amenity relating to the use of the loading bay have been dealt with above.

78 Mrs Jones' objection was in part directed to the lack of need for this facility. She informed us that from where she lives in Inkerman Street diagonally opposite the site she finds it convenient to shop in Acland Street and the Prahran Market and sees no need for another supermarket.

79 Her amenity objections were; noise pollution and dust during the construction phase, bright lights, rubbish, traffic, noise problems with the supermarket's operation, and pedestrian safety. However no additional construction impacts will result from the amendment of the permit to allow the supermarket and loading bay as the construction of the building is already approved and has commenced.

80 Under the present approved proposal cars driving in and out of the car park may impact on her property. As the Aldi Supermarket will operate mainly during the day there will not be any significant head light glare arising from any increase in use of the car park by Aldi Supermarket customers. In any event Inkerman Street is hardly a quiet pedestrian environment carrying 12,000 vehicles per day.

81 Mrs Jones also expressed concern that delivery trucks may use her side street, however given the evidence as to the number of delivery trucks and the proposed loading bay access, we do not think there will be any occasion for truck use of her street that will have a detrimental impact.

82 In conclusion we find that the proposal for an Aldi supermarket is appropriate to the site. The supermarket is not a full range supermarket nor is it comparable to the general run of supermarkets; having a small food product line on offer and a range of discount specials. We find the use to be comparable to a convenience store with a bargain store component that will fill a niche market and have little or no impact on existing retail activity.

83 In our view, overall, the proposal represents a net community benefit in providing price savings to the local community and employment opportunities. We consider that this outlet will meet its parking needs on site and given the nature of the goods on offer will either be a single trip destination or part of a multiple shopping trip but will not in any event add significantly, if at all, to the shopping kilometres expended.

[1]SMA Projects v Port Phillip City Council [1999] VCAT 1312 (31 July 1999)

[2] Doncaster Road Property Partnership v Manningham City Council (2004) 19 VPR 72 at [51] - [60]

[3] Whitehorse City Council v Golden Ridge Investments Pty Ltd [2005] VCSA 198 @ [29]

[4] Azzure Investments Pty Ltd v Port Phillip City Council [2004] VCAT 2027 (26 October 2004)

[5] Glenwaye Pty Ltd v Glen Eira City Council [2006] VCAT 300 (2 March 2006)