[2002] VCAT 301

The decision of the Responsible Authority in relation to permit application no. TP01/345 is affirmed.

Pursuant to Section 85(1)(a) of the Planning and Environment Act 1987, it is directed that a permit must not be granted.

Mr R Osborn QC and Mr A Finanzio of Counsel appeared (by direct brief) on behalf of the Respondent/permit applicant. They called the following persons to give evidence:

s Mr P Lovell, Conservation Consultant of Allom Lovell and Associates Pty Ltd;

s Mr P Fearnside, Acoustic Engineer of Marshall Day Acoustics;

s Mr S Hunt, Traffic Engineer of Grogan Richards Pty Ltd;

s Professor P Goad, Architectural Historian and Design Critic.

A written statement by Ms C Frank-Mas, Landscape Architect, was tendered.

Mr I Murray, Solicitor of Mallesons Stephen Jaques, appeared on behalf of the Responsible Authority and called Ms M Gould, Conservation Architect, to give evidence.

Mr A Southall QC and Mr D Littlejohn of Counsel, instructed by the Solicitor for the Environmental Defenders Office, appeared on behalf of the East Melbourne Group Inc. Mr Southall was in attendance on Days 1-5 and 7 of the Hearing. Mr Southall called the following persons to give evidence:

s Mr G Butler, Conservation and Heritage Architect;

s Mr M Gerner, Town Planner of KLM Gerner Consulting; and

Mr Southall also called Mrs M Wood, President of the East Melbourne Group Inc., and Mr P N Winter, Senior Vice President of the East Melbourne Group Inc. to give evidence in their capacity as office bearers of the East Melbourne Group Inc. and as residents who would be affected by the proposed development.

Ms R Hansen of Hansen Partnership appeared on behalf of Mr G Morgan. Mr W Bromhead of Hansen Partnership was also present during part of the Hearing.

Mrs F Robertson appeared on her own behalf as a Respondent Objector.

All parties presented written and verbal submissions and a number of plans, photographs and other documents were tendered to the Tribunal. Photomontages formed part of Mr Goss's evidence. A slide presentation was made by Mr Lovell. A video presentation was given by Mr Goss. All material is retained on file and has been considered by the Tribunal. All witnesses were made available for cross-examination.

The subject site and locality were inspected by the Tribunal in the presence of representatives of the parties on the morning of Day 2 of the Hearing. This included car parking at the Hilton Hotel, views over the site and surrounding area from various levels of the Hilton Hotel, and an inspection of the dwellings at Nos. 193 & 201 George Street.

1. This is an Application under Section 77 of the Planning and Environment Act 1987 brought by PCH Melbourne Pty Ltd to review a decision by the Melbourne City Council ("the Council") to refuse to grant a permit in application no. TP01/345. A Notice of Refusal was issued by the Council on 23 October on the following grounds:

* The proposed development is inappropriate in terms of its height.

* The proposed development is inappropriate in terms of its bulk and scale.

2. The Application for Review was lodged on 26 October 2001 on grounds essentially rebutting those set out in the Notice.

3. The matter was the subject of Directions Hearings on 21 January 2002 and 28 February 2002. Orders were given. Leave was granted to substitute the plans (A-01 - A-20, all Revision B). We refer to these substituted plans as the "certified plans".

4. The matter was also the subject of a Directions Hearing before His Honour J Kellam, President of VCAT, where the constitution of the Tribunal was confirmed with the parties prior to the Hearing.

5. At the commencement of the Hearing, Mr Osborn QC referred to a revised set of plans that had been circulated in the week before the Hearing. These plans sought to correct a number of errors in relation to the context of the site, notably the height of the recent development at No. 148 - 160 Wellington Parade (also referred to by a number of the parties as No. 1 Powlett Street) and other nearby buildings. The changes were described by Mr Poole at the commencement of the Hearing and were noted by the Tribunal. We describe these plans as the "revised plans" [marked as Exhibit A1]. The Tribunal requested that an RL for the development at No. 148 - 160 Wellington Parade be provided.

6. At the commencement of Day 3 of the Hearing, Mr Osborn explained that a further error had been found when seeking further information in relation to the RL for the completed development at No. 148-160 Wellington Parade. He indicated that the intent was for the proposed development to match the height of No. 176 Wellington Parade (as all relevant experts had based their evidence upon this fact). RL information had drawn attention to the fact that the proposed development is one storey higher than No. 176 Wellington Parade.

7. During Day 4 of the Hearing, Mr Osborn tendered a corrected set of plans, dated April 2002 Revision C, which we refer to as the "tendered plans" [ExhibitA31]. Mr Poole described the changes and revised RLs. Those plans provided for the removal of one level, for a decrease in the number of dwellings from 65 to 60, and for a reduction in the maximum height of the building from around 53 metres to around 48.8 metres.

8. Notwithstanding these changes, all parties agreed to the continuation of the proceedings, without adjournment and without the need to re-call any of the witnesses who had given evidence and appeared on the first three days of the Hearing.

9. The subject land is located on the north side of Wellington Parade, between Clarendon Street and Powlett Street. It is regular in shape and has a frontage of 20.46 metres, a depth of 50.24 metres, and a total area of 1,028 square metres. The land has a slight fall from north to south.

10. The subject land is occupied by the MCG Hotel, a two storey building. The Hotel was constructed in the 19th century and is graded `C' in both the 1985 East Melbourne and Jolimont Conservation Study and the 2000 Heritage Places Inventory. The MCG Hotel comprises a front section with two hipped roof forms (the front roof section being higher than the rear). East and west wings are set behind with a beer garden to the rear. A covered carriageway through to former stables extends along the west side of the building. The ground level of the Hotel is substantially altered and is retained in use as a licensed premises. The upper level is not accessible to the public and appears to be used primarily for plant and storage.

11. The MCG Hotel is contained within the same title as the Hilton Hotel. This landmark building, located on the corner of Wellington Parade and Clarendon Street, opposite the Fitzroy Gardens, comprises a 20 storey brick tower and two storey podium. The podium abuts the western boundary of the MCG Hotel. The Hilton is setback approximately 11.5 metres from the Wellington Parade frontage, allowing for a porte corchere as well as ramps providing ingress and egress to and from a basement car park. The podium (which contains a ballroom) is some 35 metres wide extending eastwards between the Hilton tower and MCG Hotel.

12. To the east of the MCG Hotel, there are three high rise buildings:

s immediately to the east, at No. 176 Wellington Parade, is a recently refurbished office building of 13 storeys, constructed in the 1960s by the State Government.

s No. 166 Wellington Parade, is another former State Government office building also from the 1960s. It has recently been converted into apartments and comprises 12 levels.

s No. 148 - 160 Wellington Parade is a 7-14 storey building that has recently been completed. This building steps down toward the Powlett Street/Wellington Parade corner. In 1999, a permit for this development was issued at the direction of another division of the Tribunal in Appeal Nos. 1998/43208 and 1998/35283 Oakley Pty Ltd v City of Melbourne and Ors.

13. Further to the east on Wellington Parade, beyond Powlett Street, is a row of inter-war two storey retail premises (with some non-retail uses above), other retail premises and offices. Residences predominate further east of Simpson Street. Heights between Powlett Street and Punt Road range from 2 - 6 storeys with one 7 storey building.

14. To the rear of the subject land, residential properties address George Street:

s No. 189 George Street, abutting the northern boundary of the subject site, accommodates a three storey block of flats, with undercroft parking to the rear. Another block of flats abuts that site to its east, at No. 185 George Street.

s to the north-west, abutting the podium of the Hilton Hotel, is a two storey Victorian residence at No. 193 George Street. It is `A' graded and listed on the Victorian Heritage Register. The property has an open rear yard, including pool, and a two storey building at its south-west corner accommodates a garage and upper level accommodation. This rear structure is accessed via a laneway that extends to the rear of the Hilton Hotel (but not as far as the MCG Hotel).

s further to the west of No. 193 George Street is a row of six, two storey Victorian terraces, known as "Hepburn Terrace". They too are `A' graded and listed on the Victorian Heritage Register.

s other dwellings face the north side of George Street and include impressive two and three storey Victorian dwellings and mansions.

15. Opposite the site, on the south side of Wellington Parade, is Jolimont Station and Yarra Park. Yarra Park is home to the Melbourne Cricket Ground (MCG).

16. Wellington Parade is a main road with tram services, joining with Bridge Road and Punt Road to the east and Flinders Street to the west.

17. It is proposed to retain the front two hipped roof sections of the MCG Hotel (to a depth of approximately 12 metres) and demolish the remaining structures. The Hotel would be retained as a licensed premises, although no details were included with the application as to the nature or extent of restoration works to the façade.

18. A new building would be constructed to the rear and partly above the retained portions of the Hotel. Based on the tendered plans, the new building would comprise 13 levels of apartments over 2-3 levels of car parking plus 3-4 levels of basement parking. The new building would accommodate 60 residential apartments comprising a mix of one, two and three bedrooms. [This contrasts with the 65 units shown in the certified and revised plans].

19. The existing covered western carriageway would be converted to the pedestrian entry to the apartments above and would provide access to a lobby and lift core to be located behind the Hotel.

20. Some 91 cars could be accommodated in the part basement and part above ground car park. Access to this car park be provided from a modified, shared entry to the Hilton Hotel car park. The certified plans provided for 11 visitor spaces being available within the Hilton Hotel car park. With the tendered plans, this is reduced to two spaces.

21. Level 1 of the apartment building (which is in effect level three on the north elevation and level four along the south elevation) provides for a north-facing recreational area including enclosed pool, outdoor deck area and gym. A landscaped planter is shown across the northern edge of the deck level. Above this, each level - other than the penthouse - would comprise five apartments with the building setback between 12.43 and 14.27 metres from the rear boundary. Units 1 and 2 would have north-facing terraces, Units 3 and 4, west-facing balconies that cantilever over the Hilton podium for a depth of 1.18 metres and Unit 5, a south-facing terrace. The southern face of the building at Levels 1 and 2 would sit behind the second of the retained hip roof sections of the MCG Hotel.

22. Levels 3 - 12 of the apartment building would generally adopt the same footprint as Level 2, except that they would extend over the rear hip roof section of the retained section of MCG Hotel. The depth of the cantilever varies from 3.7 metres (east section) to 4.9 metres (west section) when measured to the south-facing balconies and is between 7.1 metres and 8.3 metres from the façade of the Hotel.

23. Level 13 comprises two penthouses, which are further recessed on both the north and south elevations.

24. The maximum height of the building is 48.87 metres (tendered plans).

25. The design adopts extensive use of glazing with sliding aluminium louvred panels to the external face of balcony balustrades.

26. The subject land is located in a Business 1 Zone under the Melbourne Planning Scheme. At Clause 34.01, the purpose of the Zone is:

* To implement the State Planning Policy Framework and the Local Planning Policy Framework, including the Municipal Strategic Statement and local planning policies.

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

27. Given that the ground level entry to the proposed units exceeds 2 metres as set out in Section 1 of the table to Clause 34.01, a permit is required to use the land for the purpose of apartments. Buildings and works also require a permit in the Business 1 Zone. The land is within 30 metres of a Residential 1 Zone and the application is not exempt from the notice and review rights of the Planning and Environment Act 1987.

28. The site is located within in a Heritage Overlay (HO2 East Melbourne and Jolimont). The purpose of the Overlay is:

s To implement the State Planning Policy Framework and the Local Planing Policy Framework including the Municipal Strategic Statement and local planning policies.

s To conserve and enhance heritage place of natural or cultural significance.

s To conserve and enhance those elements which contribute to the significance of heritage place.

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

s To conserve specifically identified heritage places by allowing a use that would otherwise be prohibited if this will demonstrably assist with the conservation of the significance of the heritage place.

29. The Heritage Overlay applies to the MCG Hotel and land to the north, east and south, but excludes the remainder of the Hilton Hotel site. Pursuant to Clause 43.01 permit is required for building and works including the demolition of an existing building in the Overlay. There is no specific statement of significance for the HO2 precinct, although the area is included on the Register of the National Estate for which there is a statement. Decision guidelines at Clause 43.01 include:

* The State Planning Policy Framework and the Local Planning Policy Framework, including the Municipal Strategic Statement and local planning policies.

* The significance of the heritage place and whether the proposal will adversely affect the natural or cultural significance of the place.

* Any applicable heritage study and any applicable conservation policy.

* Whether the location, bulk, form and appearance of the proposed building will adversely affect the significance of the heritage place.

* Whether the demolition, removal or external alteration will adversely affect the significance of the heritage place.

* Whether the proposed works will adversely affect the significance, character or appearance of the heritage place.

30. The 1985 East Melbourne and Jolimont Conservation Study is a reference document in the Scheme and the 2000 Heritage Places Inventory is an incorporated document.

31. Finally, the subject site is also affected by Design Development Overlay (DDO) Schedule 21 Wellington Parade Area. The design objectives for DDO21 include:

* To minimise the visual impact of buildings on the Fitzroy Gardens and Yarra Park and the preserve the landscape qualities and amenity of the gardens.

* To ensure that the enjoyment of the Fitzroy Gardens and Yarra Park is not excessively diminished by overshadowing for any new buildings or works.

* To ensure that any new development or redevelopment is compatible with the scale and character of adjoining buildings in the area.

* To encourage development of Wellington Parade as a major city boulevard with consistent building height and form.

32. The purpose of a Design and Development Overlay, in addition to implementing the State and Local Planning Policy Frameworks, is:

s To identify areas which are affected by specific requirements relating to the design and built form of new development. [Emphasis added]

33. At Clause 43.02-2, a permit is required to construct a building and such building "must be constructed in accordance with any requirements in a schedule to the overlay". The Clause goes on to provide, however, that a permit may be granted to construct a building not in accordance with such requirements.

34. At Clause 2.1 of Schedule 21, referring to the Wellington Parade area, there is a specific requirement in relation to building height. It states "Buildings and works should not exceed the maximum height specified in this table to this schedule". The maximum height for buildings facing the north side of Wellington Parade (other than the Hilton Hotel tower and approximately 20 metres to the east of that tower) is 24 metres. Clause 2.1 of Schedule 21 goes on to state that:

an application must be accompanied by a site analysis plan and a written urban context report documenting how the development will achieve the specific design objectives and outcomes of this schedule.

35. The outcomes for Area 20 in the Table to Schedule 21 are:

s Buildings are developed to a consistent scale along the Wellington Parade entry to the CBD but are spaced to allow sunlight to penetrate to the street and to avoid creating a wall of buildings.

s Additional overshadowing of Yarra Park between 11.00am and 2.00pm from 1 September to 30 May is avoided.

36. The State Planning Policy at Clause 19.03 of the Scheme addresses urban design and built form. It applies instead of the Good Design Guide because the height of the development is more than four storeys. Design principles relevant to this Application and which must be had regard to include provisions relating to context, the public realm, pedestrian spaces, heritage, architectural quality, light and shade.

37. A number of other policies set out in the State and Local Planning Policy Frameworks of the Planning Scheme are relevant to this proposal, including Clauses 13, 14, 15, 16, 21 (Municipal Strategic Statement known as "City Plan"), 22.02 and 22.05. In addition, we must consider, as appropriate, the general decision guidelines set out at Clause 65.

38. In relation to East Melbourne, City Plan includes the following statements:

To support the residential community and the government precinct on either side of the Fitzroy Gardens that are contained by commercial and institutional uses located along the major boulevards on its edges.

The small Wellington Parade shopping centre provides a valuable mix of convenience goods, restaurants and cafes to service the local community, as well as providing eating establishments for a broader clientele.

Planning scheme response: The area is zoned Business 1 to allow a broad range of retailing and commercial uses.

The existing residential areas of East Melbourne and Jolimont are of high quality and with limited capacity for growth. It is important to maintain existing standards and restrict the encroachment of non- residential activity.

Planning scheme response: Existing residential areas are zoned Residential 1. The Discretionary Uses in Residential Areas Policy give guidance as to how the zone will be administered.

East Melbourne and Jolimont is one of the most intact 19th Century areas in the City and of national importance. Conservation of the area's heritage is the primary development consideration.

Planning scheme response: The Heritage Overlay identifies designated heritage buildings, gardens and precincts. The Heritage Places outside the Capital City Zone Policy gives guidance on the conservation of buildings and streetscapes.

39. Clause 22.02 is a local policy relating to "Sunlight to Public Spaces". It seeks to ensure good sunlight penetration to public spaces, and to protect and enhance the amenity of public spaces.

40. Clause 22.05 is a local policy relating to the development of heritage places outside the Capital City Zone. It has three objectives:

s To conserve all parts of buildings of historic or architectural interest which contribute to the significance, character and appearance of the building, streetscape or area.

s To ensure that new development and the construction or external alteration of buildings makes a positive contribution to the built form and amenity o the area and is respectful to the architectural or historic character and appearance of the streetscape and the area.

s To promote the identification, protection and management of aboriginal cultural heritage values.

41. The Clause sets out a number of performance standards including:

The external shape of a new building, and of an addition to an existing building, should be respectful in a Level 1 or 2 streetscape, or interpretive in a Level 3 streetscape.

The façade patterns and colours of a new building, and of an addition or alteration to an existing building, should be respectful where visible in a Level 1 streetscape, and interpretative elsewhere.

The surface materials of a new building, and of an addition or alteration to an existing building should always be respectful.

The details (including verandahs ornaments, windows and doors, fences, shop fronts and advertisements) of a new building and of an addition or alteration to an existing building, should be preferably be interpretative, that is, a simplified modern interpretation of the historic form rather than a direct reproduction.

Higher rear parts of a new building, and of an addition to an existing graded building, should be ....partly concealed in a Level 2 and 3 streetscape....

The façade height and position should not dominate an adjoining outstanding building in any streetscape, or an adjoining contributory building in a Level 1 or 2 streetscape. Generally, this means that the building should neither exceed in height, nor be positioned forward of, the specified adjoining building. Conversely, the height of the façade should not be significantly lower than typical heights in the streetscape. The façade should also not be set back significantly behind typical building lines in the streetscape.

The height of a building should respect the character and scale of adjoining buildings and the streetscape. New buildings or additions within residential areas consisting of predominantly single and two storey terrace houses should not be higher than 2-3 storeys above ground level except in exceptional circumstances.

42. Definitions are included, of which the following are relevant in this Application:

s Adjoining or nearby significant buildings or works

s In the case of additions and alterations, significant parts of the subject building.

Respectful and interpretative refer to design that honestly admits its modernity while relating to the historic and architecturally significant character of its context. "Respectful" means a design approach in which historic building size, form, proportions, colours and materials are adopted, but modern interpretations are used instead of copies of historic detailing and decorative work. "Interpretative" means a looser reference to historic size, form, proportions, colours, detailing and decoration, but still requires use of historic or closely equivalent materials.

43. We have had regard to the policies and decision guidelines of the Melbourne Planning Scheme, considered the submissions and evidence presented by the parties, and inspected the subject site and locality. We consider that the key issues for consideration are:

s whether the extent of demolition of the MCG Hotel is acceptable;

s whether the proposed works represent an acceptable design response in terms of the retained portion of the MCG Hotel and the heritage place (being HO2 East Melbourne/Jolimont);

s whether the proposed works represent an acceptable design response in urban design, streetscape and neighbourhood character terms;

s whether unreasonable off-site amenity impacts will result in terms of overlooking, noise and visual bulk.

s whether the proposed car parking and traffic arrangements are acceptable.

44. We do not detail the history and associations of the MCG Hotel, as this is well described in the evidence given by Ms Gould for the Council, Mr Lovell for the Applicant, and Mr Butler for the East Melbourne Group.

45. In summary, we note that a hotel (originally named the Parade Hotel) was built on the subject land about 1853, and was the location for the formation of the Melbourne Football Club in 1858. Mr Butler's evidence was that this former (timber) building was demolished to make way for a new hotel in the early 1860s (c. 1863). Ms Gould and Mr Lovell referred to alterations and works that took place around that time, but were not necessarily in agreement with Mr Butler that the whole hotel had been replaced. Mr Butler was the only witness to have searched the rate books fully, and therefore we accept that his evidence is most likely to be the correct version of events. Nonetheless, there is no dispute that a hotel has existed on the subject site since the 1850s and has remained in operation as a licensed premises since that time. The links with the Melbourne Football Club were said by all heritage experts to be significant, as was Mr Lovell's evidence that the rules of Australian Football may have been written at the Hotel. The name of the Hotel was changed from the Parade Hotel to the MCG Hotel in 1933.

46. In physical terms, it was agreed between the experts that the façade retains a three-bay, stuccoed Renaissance revival style with punched fenestration and pediment window detail in gabled and segmental arched forms. There was concurrence in the evidence that, other than the covered carriageway, the ground level is substantially altered whereas the first floor is more intact.

47. Ms Gould and Mr Lovell supported the 'C' grading given in the 1985 East Melbourne and Jolimont Conservation Study and the 'C' grading (using a modified definition) in the 2000 Heritage Places Inventory. However, Mr Butler's evidence was that the building is worthy of a higher grading, either 'A' or 'B', based on:

s the continued use of the site as a licensed premises since an hotel was first established;

s links to William Highett, a prominent and important member of the colony, a parliamentarian, owner of the Hotel and the person who commissioned the 1860s works;

s the work of John Felix Matthews, architect of the hotel in the early 1860s.

48. These were associations recognised in the evidence of Ms Gould and Mr Lovell as of interest, but neither agreed with Mr Butler that they should cause the building's grading to be elevated beyond 'C'. Ms Gould and Mr Lovell considered that the principal significance of the building to be its external fabric, as read from the street.

49. Mrs Robertson expressed her view about the importance and unusual nature of the carriageway along the west side. She said that bluestone remains under the asphalt surface. None of the experts considered the carriageway to be of such significance to elevate the grading of the building, although it was noted as a relatively rare feature and of interest, given its covered nature.

50. Our role is not to re-grade the building. We consider that the evidence we have been presented with must be considered in the light of informing ourselves as to the significance of the existing building to the heritage place and the discretion we are asked to exercise under Clause 43.01 in relation to partial demolition and the form of the replacement works. While we accept the associations referred to by Mr Butler are of interest, we accept the building's `C' grading nominated in the incorporated document to Clause 22.05.

51. The subject site is shown within a Level 3 streetscape and it was agreed by all experts that this is correct. Level 3 is in fact the lowest grading in a heritage area and it apparently recognises the lack of any predominant heritage character in this part of the streetscape. We also observe that some 'A' graded buildings further east on Wellington Parade are also within a Level 3 streetscape. There was some discussion through the course of the Hearing as to when and how a streetscape grading was applied, but we find that of little consequence and therefore make no further comment upon it.

52. No statement of significance exists for HO2, although detailed information is set out in the 1985 East Melbourne and Jolimont Conservation Study and in the statement attached to the National Estate Registration. There can be no dispute that East Melbourne is one of Melbourne's most prized heritage precincts with its outstanding individual buildings as well as many intact and consistent streetscapes.

53. Based on their assessment, and the reasons set out above, all witnesses agreed that the existing building makes a contribution to the heritage place defined in Clause 43.01, being HO2. We accept that evidence. It is obvious that the MCG Hotel is the last remaining building on the Wellington Parade frontage, between Clarendon and Powlett Streets, that has an association with the Victorian origins of HO2. While that part of the site's setting is modified, there are links to the Victorian dwellings to the rear, fronting George Street, as well as to other parts of HO2 that include Yarra Park.

(iii) Is an Adequate Portion of the MCG Hotel Retained?

54. The proposal involves the retention of the front two hipped roof sections of the MCG Hotel. The front hip is higher than the rear roof section and the parapet of the Hotel conceals much of the roof form when viewed from street level.

55. There is no dispute that the front portion of the MCG Hotel should be retained. Evidence was given by Ms Gould for the Council and Mr Lovell for the Applicant that the extent of fabric that is proposed to be retained is appropriate. They stated that the retention of the front two rooms is a typical approach in relation to a 'C' graded building and allows the building's physical and historical associations to be read. Mr Butler's evidence for the East Melbourne Group was that the west rear wing should also be retained as it is visible down the carriageway and is part of the 19th century building fabric. In cross-examination by Mr Osborn, Mr Butler conceded that retention of the front portion of the building, as proposed, would enable the associations, which he referred to as significant, to be read.

56. We find that the retention of the front two rooms (two hipped roof elements) is acceptable and accords with the demolition policy set out in Clause 22.05. Although we would not oppose the retention of the west wing and restoration of the carriageway, the front portion and west wall are those open to view from the public realm and we accept the evidence of Ms Gould and Mr Lovell that they allow the heritage values of the place to be interpreted. The west wing is essentially only seen down the carriageway when the gates are open. The proposal retains the carriageway form, but not in a manner that would allow its use as a passageway nor enable the west wing to be viewed from the street. We return to this matter later.

57. All versions of the plans before the Tribunal (eg. A-19 Rev C) refer to the refurbishment of the MCG Hotel. Various parties and heritage experts referred to the lack of information in relation to the extent of works proposed. Mr Lovell was not aware of the details of such works. It was Mr Poole's evidence that restoration is intended by his client, although no schedule has been documented at this stage, and it could be developed further in detailed design and via a permit condition.

58. We understand resident concerns in relation to the lack of information about the form of any restoration works. In any usual circumstance involving external alterations to a building in a Heritage Overlay, a permit application must be lodged setting out the nature of the proposal and (unless a notice exemption applies) an opportunity is usually given for any third party to make submissions. Despite the credibility of the architect, we do not favour an approach that leaves the details of the restoration of the Hotel to a permit condition without the opportunity for public comment. Moreover, the nature of changes could be relevant to the relationship of the retained Hotel to the proposed apartment tower. For example, Mr Poole made reference to modifying the colour of the façade, which could be significant to how the new and old elements on the site complement one another or are read together.

59. Clause 43.01 requires consideration of the proposed building to "adjacent buildings and the heritage place" in terms of "location, bulk, form and appearance". It also requires an assessment as to whether the proposal will adversely affect the significance of the heritage place, which is HO2. Clause 22.05 assists the consideration of these matters, through the objectives and performance standards set out (which we have referred to earlier at paragraphs 40 and 41). We address these matters in turn, first examining the relationship of the proposed works to the retained MCG Hotel, then to the George Street properties and finally to HO2.

60. During the Hearing there was some discussion about the definition of 'Context', as set out in Clause 22.05. Agreement was eventually reached between Mr Osborn and Mr Southall in relation to its interpretation and we accept their interpretation. That is to say that the phrase "Adjoining and nearby significant buildings or works", referring to the context of a proposed development, means adjoining significant buildings as well as nearby significant buildings. "Significant" is also a term defined by the Clause which we have had regard to.

61. There was some discussion also as to whether the proposed apartment tower is an addition to the existing building or a new building. There was no final agreement in relation to this between the parties. While it has some relevance to the performance standard that applies in relation to the "Concealment of Higher Rear Parts (Including Additions)", we do not find the matter to be critical to the evidence before us or our examination of the proposal against the performance standards. Therefore, we do not explore it at any length and observe that none of the parties raised this as a significant issue.

62. The key issues in relation to the relationship of the proposed apartment development to the retained MCG Hotel are:

s the form of the development (mass, height and scale of the tower); and

s the proposal for the new building to partly cantilever over the rear hipped roofed section.

63. Mr Osborn conceded that the proposal does not meet the specific policies set out in Clause 22.05 in relation to the form of the replacement works. That is, the higher rear building is not partly concealed and the scale of the new works responds to the higher forms to the east and west of the subject site (which are not "significant" buildings), rather than the two and three storey residences fronting George Street (which are "adjoining" significant and/or "nearby significant buildings"). However, Mr Osborn submitted that the Hotel would retain its visual prominence and identity in the streetscape, and would not be overwhelmed by the apartment tower. The Hotel's two storey profile would be apparent when viewed from the south-west and west.

64. In his submission, Mr Osborn referred to a particular benefit of the cantilever was its ability to mask the adjacent blank wall which is treated with banding to a depth of approximately one room from Wellington Parade. He also relied upon the modernity of the proposed design and, in his submission, the suitability of façade detailing.

65. Mr Lovell's evidence for the Applicant conceded that, other than that applying to demolition, the relevant performance standards of Clause 22.05 would not be met by the proposal. In his opinion, an exception was justified in that the MCG Hotel is read in isolation and does not make a contribution to an integrated streetscape setting. Mr Lovell referred to the proposed tower as rising to reflect the scale of the dominant high rise buildings to the east.

66. Mr Lovell referred to the cantilever as an unusual approach and one where the critical issue is to ensure that the cantilever does not overwhelm or dominate the retained fabric below. Mr Lovell's evidence was that the setback of around 7 metres and vertical separation of 4.5 metres are "manageable", although in cross-examination he conceded that he would prefer a lower building, as well as a deeper setback or removal of the cantilever over the retained portion of the Hotel. Mr Lovell did not regard the enclosing of the carriageway as a concern.

67. Conversely, Mr Murray, Mr Southall, Ms Hansen and Mrs Robertson submitted that the proposal is excessively dominant and tall, and consequently dwarfs and "trivializes" (as described by Ms Hansen) the heritage significance of the retained Hotel. They considered that the cantilever removes the airspace present over the Hotel and gives an appearance that the Hotel is being squashed. Moreover, they submitted that reliance should be not be placed on the existing buildings at Nos. 166 and 176 Wellington Parade as they were constructed prior to the introduction of urban conservation controls. That view was endorsed by the Panel appointed to consider Amendment L187 to the Melbourne Planning Scheme that addressed proposals for the development of the land at No. 148-160 Wellington Parade. The development that now appears on that corner was approved under the existing planning controls.

68. Mr Butler and Ms Gould shared the opinion that the cantilever is undesirable and that the height and limited setback of the apartment tower would result in the Hotel being dwarfed and appearing squat to the extent of facadism. They agreed that the design of new buildings in the heritage place should be influenced by the contributory, not the non-contributory, elements, in accordance with Clause 22.05 and Clause 43.01.

69. Mr Butler and Ms Gould also shared similar (but not identical) views as to the appropriate scale of works behind the retained MCG Hotel. Based on sight lines, Ms Gould considered a development reaching 23 metres in height would be acceptable, whereas Mr Butler referred to an approach whereby the building envelope for new works would be 30% over the perceived height, resulting in a form of around 21 metres. Both experts considered that it is reasonable for a new form to be seen behind the Hotel but not cantilevered over it. Mr Butler was also critical of the detailing of the proposed tower in terms of the glazed elements and façade detailing. He described the proposal as "boxy".

70. We have carefully considered these submissions and the evidence of the heritage experts. We note the strong opposition to the proposal, in terms of its relationship to the MCG Hotel by Ms Gould and Mr Butler. We observe what we describe as limited comfort, albeit acceptance, of the relationship in Mr Lovell's evidence.

71. We also note the slides shown by Mr Lovell are all examples of buildings with a deeper setback behind a retained heritage building and include no cantilevers. We have inspected a number of examples and, as a result, conclude that we should very carefully consider the approach before us as we agree with Mr Lovell that, in some instances, a poor outcome has resulted in heritage terms.

72. The policies of the Scheme and provisions of Clause 43.01 seek a positive outcome and respectful approach. We are not persuaded either is achieved in relation to the retained Hotel in terms of the height of the proposed apartment tower behind the building or in terms of the cantilever over part of the retained portion. We do not consider that the façade detailing or the tower's partial recession mitigates the impact.

73. We avoid a discussion about façadism, as we do not consider it necessary in discussing the merits of the current proposal. We accept Ms Gould's and Mr Butler's evidence that the bulk of the building over the retained Hotel, in terms of height and the cantilever will be dominating. The proposed building would project over the rear section of the retained Hotel and we find the relationship to be overpowering and overwhelming to that remaining structure. From the opposite side of Wellington Parade, the sense of space above the Hotel would be quite limited. From the south-west and west, within the front of the Hilton Hotel and to pedestrians walking westward along Wellington Parade, the extent of overhang would be apparent and we do not find it to be a respectful or comfortable fit. When viewed from Yarra Park, the tower may appear as an element behind the Hotel but the sheer height of the structure would dwarf the Hotel to such an extent that we cannot find the relationship to be respectful in an East Melbourne setting.

74. The extent of cantilever and height of the tower are based, considerably, on the desire to mask the wall abutting the east site boundary. On an initial view there may seem to be merit in that. However, after careful consideration we are not persuaded that a building of similar height as the wall is necessary for the range of reasons we set out in this determination. It is not a response sought by Clauses 43.01 or 22.05 and the setting of the site is not akin to the heart of central Melbourne where small historic buildings are nestled in front of substantially taller modern structures (and addressed by another policy at Clause 22.04). A lower form without the cantilever over the retained section would be more sympathetic to the 'C' graded building and could also mask a useful portion of the wall. Ms Gould and Mr Butler recommended an addition of a height that is closer to the maximum set out in DDO21. We accept their evidence that development to about that height, while retaining an exposure of part of the wall, could achieve a sound outcome in terms of the 'C' graded building as sought by Clauses 43.01 or 22.05.

75. We are persuaded by the evidence before us that part enclosure of the carriageway is acceptable, we would encourage restoration of its bluestone pavement within the unenclosed front portion as an interesting feature.

(ii) Relationship to George Street `A' Grade buildings

76. As well as being part of HO2, the George Street properties are "adjacent or nearby significant buildings or works" for the purposes of Clause 22.05 (based on definitions of context and significant). No. 193 George Street and Hepburn Terrace are `A' graded buildings and included on the Victorian Heritage Register.

77. Mr Southall and others opposing the Application expressed significant concern about the impact of the proposal on these historic buildings and others within George Street as the development would result in the loss of a visual context to the heritage buildings and bears no relationship to the lower form of houses in George Street. Mr Butler was critical of the proposal and the extent to which it would interfere with the setting of the heritage buildings. Mr Butler and Mr Gerner referred to a more balanced relationship to those nearby heritage buildings being achieved if a lower building form was adopted.

78. Mr Osborn submitted that the proposal would not impact adversely on the skyscape behind significant buildings in George Street. He observed that the subject site is not directly behind either No. 193 George Street or Hepburn Terrace and therefore the gap behind these buildings would be substantially preserved. Moreover, existing views of those heritage buildings, from oblique angles, already include modern buildings behind. The evidence of Mr Lovell was that the impact of the proposal on the George Street residences is minimised by its design and that it would read as a continuation of the backdrop of larger forms that define the urban edge. For this reason, Mr Lovell's evidence was that the proposal would not diminish the significance of the individual buildings. Mr Lovell referred to the avoidance of a wall of buildings along Wellington Parade, as referred to in DDO21, as a desirable objectives from a heritage perspective. He considered that the links (however tenuous) between the East Melbourne residential area and Yarra Park should be maintained by gaps between the taller building forms.

79. "Intermittent high buildings" was a phrase attributed to Mr Lovell by the Panel considering Amendment L187 and this is the position that he again adopted. In the case of the current proposal, Mr Lovell's evidence was that a sufficient gap is retained when considered from both George Street and Yarra Park. Mr Butler disagreed with that position and was concerned about the loss of relationship to the residential areas behind the MCG Hotel.

80. We have again considered the relationship to the George Street properties with care, as there is no doubt that these are prized and important buildings in heritage (and aesthetic) terms. Their context is already impacted to varying degrees by the intrusion of the flats to the east of No. 193 George Street and by the appearance of the Wellington Parade towers behind.

81. We accept Mr Osborn's submission that the proposal would essentially frame the dwelling at No. 193 George Street if standing directly in front of that dwelling. The cantilevered west-facing balconies would intrude slightly and it would be preferable if that was avoided in terms of the integrity of the `A' graded heritage building.

82. The apartment tower would be visible in views behind No. 193 George Street and other existing dwellings in George Street from many oblique angles. For example, from the north-west in particular, those views over Hepburn Terrace and Mosspennock already contain a backdrop of existing high rise buildings that front Wellington Parade. In some of those views, the blank west wall of No. 176 Wellington Parade provides what we describe as a neutral backdrop. That will be replaced in the current proposal by a busier and closer element.

83. Despite some materials and proportions that were said in Mr Poole's evidence to reflect the heritage buildings, in our view, the new building is more intrusive and distracting than the wall. The new building "fights" with the gracious heritage structures in an uncomfortable manner.

84. Therefore, we conclude that the context of the `A' graded buildings will be diminished. A building of a lower height, in the order of 24 metres, would essentially be concealed or have only limited exposure from many vantage points in George Street, albeit that it may intrude into visual links between Yarra Park and the residential precinct.

85. We accept that, in terms of the Wellington Parade streetscape, the proposal references the buildings to the immediate east. [HO2 does not apply to the Hilton Hotel]. In that sense, being non-contributory buildings, the proposal simply reinforces an anomalous situation and contrasts with the lower scale of contributory buildings within HO2 further east. Given the lack of heritage buildings to the Wellington Parade frontage in close proximity to the subject site we conclude that there are no other adverse effects in terms of adjacent heritage buildings.

86. Given our findings above, we find that the proposal would adversely affect the heritage place, HO2.

87. This finding is reinforced by the consistent evidence of Mr Butler and Mr Lovell that if the proposal proceeds, there are reasonable grounds to reconsider whether the Heritage Overlay should remain over the Wellington Parade frontage from the MCG Hotel to Powlett Street. That evidence is persuasive and such an outcome if implemented, retracting the heritage precinct, could hardly be said to be consistent with the purpose of the Heritage Overlay.

88. We also refer to Clause 19.03 that states in relation to "Heritage" that "New development should respect, but not simply copy, historic precedents and create a worthy legacy for future generations". For the reasons set out above, we are unable to find that the proposed works would create a worthy legacy.

89. We first summarise the expert evidence (Mr Poole, Dr Goad and Mr Rogers) and submissions of the Applicant as follows. There are a number of design options possible and the approach adopted seeks a slim and compact building to properly finish the wall of buildings to the east - a row that is unfinished at present as evident in the large and, in opinions, unsightly wall to No. 176 Wellington Parade. The development would provide an active and interesting façade and interface, stepped back toward the Hilton. A sufficiently large gap is retained between the proposed development and Hilton tower in accordance with the design outcome sought by DDO21. It would create an appropriate "book-end" for the higher buildings to the east and contribute to the development of Wellington Parade as a major boulevard of a consistent height and form.

90. It was submitted that a lower building extending across the existing gap would not mask the wall and that a stepped form (similar to Nos. 148-160 Wellington Parade) would not respond properly to the taller elements within which the site sits and is framed. Shadows will not unreasonably impact on the public realm. A section 173 agreement can ensure that the gap remains.

91. Conversely, the submissions of the Council and Respondent Objectors, and evidence of Mr Gerner and Mr O'Dwyer, were that East Melbourne is not typified by a wall of tall buildings and the existing buildings should not be relied upon as a precedent. The development would add to and reinforce the wall of buildings along Wellington Parade, contrary to the outcome sought by DDO21, resulting in a loss of sky and increased shadowing to Wellington Parade, Jolimont Station and Yarra Park. In their submissions, also there could be no guarantee that the gap that was left would remain. The evidence of Mr Winter and the submission by Mrs Robertson referred to the shadowing and wind effects experienced along Wellington Parade and to buildings adjacent to the subject site and their concern that these impacts would be exacerbated by the proposal. The Council and Objectors shared the view that a lower building form, complying with the maximum height of DDO21 (Area 20), would maintain a break in the wall and allow a reasonable degree of access to sky and daylight.

92. Arising from these submissions and evidence, there are two major considerations when reviewing the proposal in terms of the provisions of the DDO (Schedule 21). They derive from the design outcomes sought by Area 20 when considering a proposal that exceeds the specified maximum height limit of 24 metres. Those outcomes are summarised by us as the urban design response sought along Wellington Parade in its role as an entry to the CBD and overshadowing of Yarra Park. These considerations in turn relate to the design objectives for DDO21, which we have set out in full at paragraph 31. We consider each matter in turn but first make several observations:

s DDO21 was introduced in awareness of the presence of the buildings at No. 166 & 176 Wellington Parade. The building on the corner of Powlett Street was approved under existing controls. We contrast the subject site with that latter recent building in a number of aspects; notably, the subject site includes a recognised heritage building of two storeys, and it is mid-block not on a corner.

s the separation of taller buildings from existing buildings was a matter raised in the exhibition of the new format Planning Scheme in a submission by A T Cocks Consulting for THL Development Holdings Pty Ltd, the then and current owner of the subject site. The report of the Panel/Advisory Committee reviewing the new format Scheme (April 1998) states that the submittor sought the addition of a provision to the proposed DDO 21 Area 20 requiring that taller buildings be appropriately separated from existing buildings. The wording recommended by the Panel/Advisory Committee referred, apparently after discussion with the representative for the submittor, to the discouragement of a wall of buildings being developed along Wellington Parade.

s it is not our role to change the intent of the DDO nor to find that it has been wrongly applied to a site or locality. Rather, we need to make a judgement as to the appropriate amount of weight to be given to the desired outcomes, having regard to the circumstances of the site, and all other relevant matters.

93. The first design outcome sought for Area 20 is:

Buildings are developed to a consistent scale along the Wellington Parade entry to the CBD but are spaced to allow sunlight to penetrate to the street and to avoid creating a wall of buildings.

94. There was a range of views expressed in relation to the key components of this outcome - what is "consistent scale", what comprises "the Wellington Parade entry to the CBD", what is adequate spacing to allow sunlight to penetrate the street, and is the creation of a wall of buildings avoided by the proposal.

95. We first refer to the matter of what comprises the Wellington Parade entry to the CBD.

96. We do not think that there is any dispute between the parties that the Wellington Parade entry relates to the whole of the DDO21, Area 20, as shown on the relevant Planning Scheme map. We consider that to be the correct interpretation. In a discussion about the DDO provisions, a number of submissions sought to give weight to the scale of development to the north of the subject site. While we find that inter-relationship important in heritage and neighbourhood character terms, and consider it in other sections of these reasons, we do not give it great weight in terms of the DDO provisions as the DDO does not apply to abutting properties fronting George Street. It is our view that the relevant Overlay control, with its discretionary 24 metre maximum, has been introduced in the knowledge that buildings of potentially 24 metres (or higher) could be sited along the north side of Wellington Parade abutting the lower scale residential area to the north. Moreover, the Overlay provisions focus on two specific matters - the relationship to Yarra Park and the Wellington Parade precinct.

97. In relation to "consistent scale", we understand the evidence of all witnesses that the form of development in the block between Powlett Street and Clarendon Street is predominantly over 7 storeys, the exceptions being the Hilton podium and MCG Hotel. This contrasts with the lower building form fronting Wellington Parade to the east, and extending to Punt Road.

98. The evidence and submissions for the Applicant placed emphasis on this existing contrasting scale. Mr Poole emphasised an imperative to mask the blank wall to No. 176 Wellington Parade and the discordant lift element that rises above and sits proud of other components of No. 176 Wellington Parade and adjacent buildings.

99. Another perspective which we prefer is that the consistent scale sought by the Scheme is not of the tallest buildings in this section of DDO21, but a scale that reflects the 24 metre maximum height limit specified. While we must take into account the context of the subject site that includes the adjacent structures that substantially exceed 24 metres (and which we address further below) we understand the intent of the DDO is to seek a scale that is consistent with that which predominates in the whole of the DDO. It is relevant that the landmark Hilton tower and part of the adjacent podium are specifically excluded from DDO21.

100. There is no doubt that the proposal (as revised) is generally of a consistent scale with its immediate neighbours - although we have some issue with that, as we discuss below. However, on a wider view, the proposal is double the maximum height specified for the DDO and which lower building form that predominates in the broader context.

101. Mr Osborn described the buildings within the block as closest to the CBD end of the block. While we agree with his observation, we consider that if the urban design response for the Wellington Parade entry had sought to step up toward the CBD, ie. within the western-most block of Sub-Area 20, then it would have said so, or varying height limits across the Sub-Area would have adopted. Neither is the case.

102. The next two matters in terms of the design outcomes of DDO21 are considered together; that is, the extent to which the spacing of the proposal from the Hilton tower is sufficient to allow sunlight to penetrate the street, and whether the creation of a wall of buildings is avoided by the proposal or is a suitable response given the context of this site.

103. The design approach has specifically sought to respond to and finish what was described by Mr Poole and other witnesses as the unfinished row of buildings to the east of the subject site. On the one hand we have evidence for the Applicant that such an approach is desirable when contrasted with a lower but wider building, whereas we also have evidence for those opposing the Application that a lower and wider form would better achieve the outcomes sought by DDO in terms of retaining a wider space and reduced shadowing.

104. There is, obviously, a fundamental difference in relation to the design philosophy.

105. We consider that, contrary to the intentions of DDO21, the proposal has been designed to add to the wall of buildings. We are not persuaded that this outcome is mitigated by the recessive elements in the façade.

106. The form and scale of the proposal has the consequence of adding to shadows that impact already on the amenity of the public realm and amenity of Wellington Parade (south side) although probably not Jolimont Station (based on the tendered plans). We doubt that the proposal enables a suitable degree of sunlight penetration nor satisfies the provisions of Clause 19.03 which state: "Enjoyment of the public realm should be enhanced by a desirable balance of sunlight and shade". Having said that, we accept that a significant space is retained over the Hilton podium, of around 33.8 metres, allowing sunlight to penetrate the south side of the street.

107. The provision of balconies and windows in the west elevation of the proposed tower would impact on a development contemplated within the retained gap. This is not sufficient to conclude, however, that development within the gap could never be contemplated or could never be approved. A Section 173 agreement may be an appropriate way to ensure that such a future development outcome was prevented. We agree, however, with Mr Southall and Mr Murray that the better outcome would be a Section 173 agreement that stood alone rather than being tied to a condition of a planning permit.

108. The design approach described by Mr Poole and Mr Rogers assumes that the west wall of No. 176 Wellington Parade must be fully masked, as well as the discordant plant room. We consider that undue emphasis has been given to any perceived need or obligation to mask the whole wall. Blank walls are often sought to be discouraged, and we generally concur with that urban design principle. However, the existing wall has been treated in the recent renovations to No. 176 Wellington Parade and appears finished in one sense. More importantly, the blank wall is most apparent in closer views from street level, most obviously from Wellington Parade to the south-west and, to a lesser extent, the southern extension of Clarendon Street leading to Wellington Parade South. From many other views, parts of the wall are obscured by buildings (eg. only upper section visible behind the George Street residences) or filtered/masked by street trees or vegetation within Yarra Park.

109. The DDO encourages and seeks an approach involving a lower more continuous form rather than an addition to the wall of high buildings with deeper vertical transition. We are not persuaded that the existing condition of the west wall is so poor that a new building is required to mask the wall and plant room in their entirety. Nor are we persuaded that a lower building form could not conceal much of the wall given the influence of perspective in street views. A lower building would also improve the relationship with the buildings to the north. We also consider that an interesting treatment to an exposed upper portion of the west wall, without a building, would be possible to reduce perceived impact.

110. The second design outcome is that "Additional overshadowing of Yarra Park between 11.00am and 2.00pm from 1 September to 30 May is avoided".

111. The shadow diagrams provided in the certified plans show the extent of shadow cast by the proposal at the March equinox. Modified shadow diagrams form part of the tendered and revised sets of plans and show that the length of shadows is reduced. Mr Poole gave evidence that the shadowing impacts of the proposal are marginal. Based on the certified/revised plans, Mr O'Dwyer was critical of the potential for shadows to be cast over part of the Jolimont railway station and north section of Yarra Park (including during winter).

112. The projected shadows do not extend over Yarra Park at the March equinox although into winter, longer shadows would be cast as was the evidence and concern of Mr O'Dwyer.

113. While we have concerns in relation to Wellington Parade, as described above, the limited shadowing of Jolimont Station or Yarra Park is less of a concern and would not cause us to reject the Application.

114. The main issues in terms of potential off-site amenity impacts are overlooking, visual bulk, noise and wind effects. We address each matter in turn mindful that residences on the south side of George Street are within a Residential 1 Zone but abut a Business 1 Zone with a maximum (discretionary) building height of 24 metres. In this circumstance, residents cannot expect an interface with neighbours to the rear that is akin to a situation where the abutting properties are within a Residential 1 Zone. Having said that, the submissions of Objectors and the evidence of Mr Gerner on their behalf appeared cognisant of these circumstances.

115. Our principle concern is in terms of visual bulk. Mr Rogers gave evidence that when viewed from the George Street residences, the proposal would read as part of the built edge to Wellington Parade and would not be a significant issue. He noted that the closest units to the north of the site have opaque and non-habitable south-facing windows. Mr Rogers also did not consider visual bulk to be a concern in relation to dwellings on the north side of George Street, given the separation, façade articulation, 35 metre gap and relatively limited building width. Conversely, the evidence of Mr Gerner and submission of Ms Hansen were that the built mass would be evident to residents to the north-east of the site and would exacerbate the dominating and walled-effect that already is apparent. The loss of skyscape was a matter emphasised by Mr Southall.

116. The existing residences on the south side of George Street are exposed to the mass presented by the Hilton Hotel and other large buildings to the east of the subject site. The proposal would retain a sky gap that is important in providing a sense of spacing. However, the addition to the existing wall of buildings would bring that building mass closer to existing residents. It is less of an issue in relation to the adjacent flats to the north of the site than is the case for the balconies of the units at No. 185 George Street, the more open rear yards and rear living room windows of No. 193 George Street, and the Hepburn Terrace dwellings.

117. The impact is most severe for the rear living area, open yard and pool to No. 193 George Street which would be presented with the looming form of a 48.8 metre structure at their south-east with the tower setback only by around 12.4 metres and with only a limited recession of the penthouse level. The rear study of No. 193 George Street also has a clear glazed verandah element and windows through which the building would be visible.

118. We have less issue in relation to views from residences on the north side of George Street.

119. The next matter is overlooking. Mr Rogers' evidence was there are limited opportunities for overlooking into private gardens or habitable rooms in nearby dwellings as a result of the podium level, recessed wall, and balustrade treatment. Oblique views may be possible from the living rooms of some units and separation distances well exceed the minimum of 9 metres suggested by the Good Design Guide. Conversely, the evidence of Mr Gerner, Mrs Wood and submission by Ms Hansen all referred to the increase in overlooking that would occur when contrasted with more limited views from the Hilton and the offices at No. 176 Wellington Parade. Views from lower level apartments were of greater concern than upper level apartments.

120. We note that some residences in George Street would be confronted with expanses of glass with the potential for overlooking, although this is not an issue in relation to the flats immediately to the north of the subject site as they have opaque glazing and what appears to be non-habitable rooms facing south. The rear of residences to the north-west of the subject site would be subjected to the potential for overlooking from some north-facing balconies albeit that the use of moveable screens could restrict actual or perceived overlooking. So too would the planting proposed along the edges of the rear pool deck. We record that perceived or actual overlooking will be an issue even if a building of a significantly lower form is proposed, although in that event, there would be a lesser number of windows and balconies involved. We agree with Mr Poole and Mr Rogers that fine tuning of screen placement and balustrade design could also go some way to addressing unreasonable overlooking.

121. Noise associated with balconies and the pool/deck area were further concerns raised by local residents. Those submissions were challenged through the evidence of Mr Fearnside and Mr Rogers. We also note that it was not a matter considered to be a significant issue in the evidence and cross-examination of Mr Gerner.

122. We do not find noise intrusion to be a matter that should cause the Application to be rejected. We accept Mr Fearnside's evidence in relation to potential noise impacts associated with plant and equipment and the outdoor recreational area. We accept that the conditions as he recommended could address the potential for unreasonable noise to emanate from both of these sources.

123. We note concerns about changed wind conditions and evidence of Mr Rogers in this regard. We do not find a basis to reject the Application for reason of altered or unreasonable wind conditions.

124. Given our findings above, we make only brief comments in relation to traffic and car parking considerations. We are satisfied that the provision of on-site car parking is adequate to service the demands generated by the development in principle, based on 60 units and the provision of most visitor car parking within the development. We make no findings in relation to the existing car parking arrangements for the Hilton Hotel, which was a matter of some concern to local residents in terms of compliance with the existing planning permit. Modifications to the access arrangements for the Hilton car park, including internal ramps, would have a benefit of allowing some additional car spaces within the Hotel basement, and that is a positive element of the current proposal.

125. Some concern was raised in submissions by Respondent Objectors in relation to the above ground car parking element. While we agree that in a Heritage Overlay such a form may be questionable, the proposed solid podium is not dissimilar to the Hilton podium and is well concealed from most public viewpoints. The solid north wall may have the benefit of reducing impacts on neighbouring residents when contrasted with a more active interface. Moreover, the solid wall, which can be treated and visually softened, is not of a height that would cause it to directly impact on the heritage values of No. 193 George Street or any of the Hepburn Terrace dwellings (a number of which have structures along their rear boundary).

126. Traffic impact was not a matter seriously pursued by any party and we accept Mr Hunt's evidence that the increase in traffic associated with the proposal is acceptable.

s the retained portion of the MCG Hotel is acceptable in terms of the heritage place.

s the form of the proposed building is too high and overwhelming relative to the retained portion of the MCG Hotel given its height and the extent to which it cantilevers over the lower hipped roof section. In this regard, it does not comply with the policies at Clause 22.05 or the provisions of Clause 43.01, as it will not adequately conserve and enhance the host building or HO2.

s the proposed works will overwhelm the setting of some of the 'A' graded heritage buildings to the north-west when viewed from the public realm (particularly George Street) and from within those sites (an impact that diminishes as one moves westward).

s the proposed works do not comply with the design outcomes of DDO21 (Area 20) in so far as the tower will contribute to and extend an appearance of a wall of buildings that is specifically discouraged in the Overlay.

s impacts on adjacent residents in terms of visual bulk are significant, albeit the interface is with a Business 1 Zone;

s car parking, traffic and overlooking impacts are acceptable, or could be made to be so.

128. Although the proposal fails many of the tests of the Scheme, we are asked by the Applicant to give great weight to, and take a pragmatic approach to the presence of, existing buildings to the east and west of the subject site that also do not comply with the preferred height limit of DDO21 nor are sympathetic to the heritage values of East Melbourne. The starting point for this proposal, and a continuing emphasis in the evidence for the proponent, has been to match the height of the adjacent buildings to the east notably No. 176 Wellington Parade including its west wall and plant room. While we can understand why that has occurred, such an approach does not have its basis within the directions of the Planning Scheme and results in an outcome that is contrary to what is sought by the planning policy regime for the area. We are particularly concerned that the cantilevered form and height of the proposed tower unreasonably compromise the retained portion of the MCG Hotel.

129. For reasons we have explained at some length, we are therefore not persuaded to set aside the decision of the Responsible Authority. We are, however, persuaded that an alternative concept is possible that more closely responds to the urban design, heritage and amenity objectives set out in the Planning Scheme.

For the above reasons, the decision of the Responsible Authority is affirmed and we will direct that a permit must not be granted.