VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL	
planning and environment LIST	vcat reference No. P422/2020
Permit Application no. PLN19/0491	
CATCHWORDS	
Section 79 Planning and Environment Act 1987; Yarra Planning Scheme; Commercial 1 Zone; Heritage Overlay; Multi-level, mixed-use building; Policy; Built form; Heritage; Urban Design. 	

APPLICANT	SMA No. 17 Pty Ltd	
responsible authority	Yarra City Council	
Referral Authority	Head, Transport for Victoria	
RESPONDENTs	Protect Fitzroy North Inc., Fitzroy Residents Association Inc., T Alberdingk, M Cannon, M Portelli, M Bogan	
SUBJECT LAND	84-104 Johnston Street, Fitzroy	
HEARING TYPE	Hearing	
DATEs OF HEARING	21, 22, 23, 24 and 25 September 2020	
date of interim order	12 October 2020	
DATE OF ORDER	11 December 2020	
CITATION	SMA No. 17 Pty Ltd v Yarra CC [2020] VCAT 1364	

Order
1	Pursuant to section 127 of the Victorian Civil and Administrative Tribunal Act 1998 the application is amended by changing the name of the applicant to:
SMA No. 17 Pty Ltd
2	Pursuant to clause 64 of Schedule 1 of the Victorian Civil and Administrative Tribunal Act 1998 the permit application is amended by changing the name of the permit applicant to:
SMA No. 17 Pty Ltd
3	Pursuant to clause 64 of Schedule 1 of the Victorian Civil and Administrative Tribunal Act 1998, the permit application is amended by substituting for the permit application plans, the following plans filed with the Tribunal:
•	Prepared by:	Hayball Pty Ltd	
•	Drawing numbers:	TP01.0B1 - TP01.0B4; TP01.0G; TP01.01 – TP01.11; TP01.0Ga; TP06.01 – TP06.04; TP07.01 – TP07.04; Exterior Materials Palette, all marked Revision D. 	
•	Dated:	10 August 2020  	

4	In application P422/2020 the decision of the responsible authority is affirmed.
5	In planning permit application PLN19/0491 no permit is granted.

Bill Sibonis
Senior Member		Stephen Axford
Member	

Appearances
For SMA No. 17 Pty Ltd	Mr I Pitt QC of Best Hooper Lawyers.  Evidence was called from:
•	Mr J Kiriakidis, Traffic Engineer of GTA Consultants (VIC) Pty Ltd
•	Ms K Jordan, Landscape Architect of Tract Consultants Pty Ltd
•	Dr M Eaddy, Engineer of MEL Consultants Pty Ltd (wind engineering)
•	Mr J Talacko, Environmentally Sustainable Development Consultant of ARK Resources Pty Ltd
•	Mr N Peters, Acoustic Engineer of Renzo Tonin & Associates (VIC) Pty Ltd
•	Mr P Lovell, Heritage Consultant of Lovell Chen Pty Ltd
•	Mr M Sheppard, Urban Designer of Kinetica Studio Pty Ltd
•	Mr A Biacsi, Town Planner of Contour Consultants Australia Pty Ltd
The evidence (photomontages) of Mr C Goss, Architect of Orbit Solutions Pty Ltd was tendered.  Mr Goss was not called to give oral evidence.	
For Yarra City Council	Mr J Rantino, Solicitor of Maddocks Lawyers.  Evidence was called from:
•	Mr S McPherson, Urban Designer of Global South Pty Ltd
•	Mr J Gard’ner, Heritage Consultant of GJM Heritage	
For Fitzroy Residents Association Inc. and M Portelli	Mr M Brennan	
For Protect Fitzroy North Inc.	Mr G McCallum	
For T Alberdingk and M Cannon	Mr T Alberdingk	
Mr M Bogan	In person	

Information
Description of proposal	The construction of an 11-storey mixed-use development accommodating ground floor retail and upper level apartments.  Parking is provided in a four-level basement, with vehicle access from Fitzroy Street.
The ground floor retail is in the form of two tenancies with display windows and openings to Johnston Street.
The building composition is of a four-storey base to Johnston Street, that rises to seven storeys at the corner of Fitzroy Street.  Above that is a relatively unadorned mid-section that incorporates operable screens to recessed balconies, and is set back 5.0m from the four-storey base. The building is capped with a two-storey penthouse that is finished in contrasting dark glazing and is further inset from all sides.	
Nature of proceeding	Application under section 79 of the Planning and Environment Act 1987 – to review the failure to grant a permit within the prescribed time.	
Planning scheme	Yarra Planning Scheme (Planning Scheme)	
Zone and overlays	Commercial 1 Zone (C1Z)
Mixed Use Zone (MUZ)
Heritage Overlay – Schedule 334, South Fitzroy Precinct (HO334)
Part Environmental Audit Overlay (EAO)	
Permit requirements	Cl. 32.04-6 (the construction of two or more dwellings on a lot in MUZ)
Cl. 34.01-1 and Cl. 71.03 (use of land in C1Z for a dwelling)
Cl. 34.01-4 (the construction of a building and the construction and carrying out of works on land in C1Z)
Cl. 43.01-1 (demolition; the construction of a building and the construction and carrying out of works on land in HO334)	
	Cl. 52.02 (removal of an easement)
Cl. 52.06-3 (reduction of the car parking requirement)	
Key scheme policies and provisions	Cl. 11, 13, 15, 16, 17, 18, 21, 22.02, 22.05, 22.07, 22.16, 22.17, 32.04, 34.01, 43.01, 52.02, 52.06, 52.34, 53.06, 58 and 65	
Land description	The review site is located on the south-east corner of Johnston Street and Fitzroy Street in Fitzroy, approximately 40 metres west of Brunswick Street.  The land has a frontage of 50.9 metres, a depth of 32.91 metres and an overall site area of 1644 square metres.  A two-storey office building dating from the 1980s occupies the site.	
Tribunal inspection	A site inspection was undertaken after the hearing.	

Reasons
What is this proceeding about?
1	In July 2019, an application was made to the Yarra City Council (Council) for a planning permit to construct an 11-storey, mixed-use building on the review site.  Notice of the application was given and 175 objections were received.
2	As the Council did not decide the planning application within the prescribed period, the applicant has made this application to the Tribunal for a review of the Council’s failure to grant a permit.  Subsequently, and after considering a comprehensive officer’s report, the Council determined that, had this application not been lodged with the Tribunal, it would have refused a permit on grounds addressing matters of height, massing, heritage, internal amenity, equitable development and wind impacts.
3	Before the hearing, the applicant prepared amended plans of the proposal.  According to the Statement of Notice submitted by the applicant, notice of the amended plans was given in accordance with the requirements of the Tribunal’s Practice Note PNPE9, Amendment of Plans and Applications.  Amongst other changes, the plans show:
•	a reduction in the street wall height to both Johnston Street and Fitzroy Street
•	increased setbacks for upper levels
•	a relocation of the communal open space area to the roof-top
•	a reduction in the number of dwellings from 107 to 77, and a reduced number of car spaces
•	revised internal layouts for dwellings.
4	At the commencement of the hearing, there being no objection from the parties, the planning application was amended by substituting these plans for the application plans.
5	Having assessed the amended plans, the Council maintained its opposition to the grant of a permit.  The respondents support the Council’s position.
6	On the basis of the submission, the key issues in this matter may be expressed as follows:
•	Does the proposed built form respond acceptably to the site’s physical and strategic context?
•	Is the treatment of the lane abuttal acceptable?
•	Is the presentation of the retail frontage to Johnston Street acceptable?
•	Is sufficient car parking provided and will there be any unacceptable traffic impacts?
•	Will the development result in any unacceptable wind impacts?
•	Does the proposal provide equitable development opportunities for adjoining land?
•	Will the development provide an acceptable level of internal amenity for occupants?
7	The Tribunal must decide whether a permit should be granted and, if so, what conditions should be applied.  Having considered the submissions and evidence, with regard to the relevant policies and provisions of the Planning Scheme, assisted by our inspection, we have determined to affirm the Council’s decision.  Our reasons follow.
What is the site’s physical context?
8	The property is located at the western end of the Johnston Street Neighbourhood Activity Centre, and adjoins the Brunswick Street Major Activity Centre.  Reflective of this location, the Johnston Street context is characterised by a mix of uses including retail, office, food and drink premises, and residential.  The area is also characterised by a diversity of built form, comprising both fine-grain heritage buildings and more recent development which is of a more robust nature and includes multi-level buildings.
9	To the east, the land adjoins a laneway and a two-storey heritage building, known as ‘A.O.F. House’, which extends further east and turns the corner southward into Brunswick Street.  The first-floor level of this building projects over the laneway to abut the review site.
10	Beyond Fitzroy Street to the west is a row of three, two-storey attached (terrace) buildings dating from the Victorian era.  Further west are two-storey commercial premises, being modern infill development, at 62-70 Johnston Street.  A permit for the redevelopment of this property was issued on 29 April, 2014.  That permit authorised the construction of a seven-storey development accommodating ground floor retail and upper level dwellings.  We were advised that the permit has lapsed.  The prevailing scale of built form on the south side of Johnston Street is two storeys.  Unlike the opposite side of the street, there are no existing multi-level developments.
11	On the north side of Johnston Street is a mix of heritage and modern built form, including a six-storey development at No. 91 and a seven-storey development at No. 57-61.  The land uses comprise a mixture of commercial, retail, nightclub/bar and residential.  The scale of development is principally one and two storey, with punctuations above this height being provided by the recent multi-storey structures.
12	To the immediate south of the site are two large former warehouse buildings fronting Victoria Street.  These date from the Victorian era and were originally constructed for the Moran and Cato grocery chain.  They are substantial and imposing buildings which have heights of three and six storeys, and accommodate a range of non-residential uses, such as design studios and the like.  A permit has been issued for the construction of a bar on the roof of the six-storey building, with a bridge connecting to an existing bar located on the roof of the neighbouring building to the east, on the corner of Brunswick Street.
13	Located to the south-west of the site (on the north-west corner of Victoria Street and Fitzroy Street) is a multi-level development known as ‘Abito’.  This presents as six storeys to the corner, with a recessed level above.  The height graduates to three storeys to the west where it interfaces with lower scale buildings in Victoria Street.  The building is constructed to the boundary of Fitzroy Street at a height of five and six storeys.
14	The south side of Victoria Street comprises low-scale, fine-grain properties accommodating heritage dwellings on narrow lots.  This character is reflective of the neighbourhood extending further to the south.
What is the relevant planning context?
15	The land is principally within the C1Z, with a strip extending along the southern boundary being within the MUZ which also extends southward and encompasses the properties on the north side of Victoria Street (including the Moran and Cato buildings and Abito).
16	The purpose of the CIZ includes creating vibrant mixed-use commercial centres for retail, office, business, entertainment and community uses, and providing residential uses at densities complementary to the role and scale of the commercial centre.
17	The purpose of the MUZ includes providing for a mix of residential, commercial, industrial and other uses which complement the mixed-use function of the locality, providing for housing at higher densities and encouraging development that responds to existing or preferred neighbourhood character.
18	The site is located within HO334, that relates to the South Fitzroy Precinct.  The building on the subject land is graded ‘Non-Contributory’ within the precinct.  It adjoins Heritage Overlay HO311, Brunswick Street Precinct and has direct abuttals to two buildings (The Moran and Cato warehouse to the south and the A.O.F. House to the east) that are graded ‘Significant’ within this precinct.
19	There is no dispute that the redevelopment of the site in the form of a multi-level building accommodating retail use and dwellings is consistent with the zone purposes.  Factors contributing to this include the location within a Neighbourhood Activity Centre and proximity to a Major Activity Centre (Brunswick Street); access to a range of services, including public transport; and its context comprising an area that is undergoing a significant degree of change, including the emergence of mid-rise development.
20	As detailed in the Council’s submission, support for the provision of housing at higher densities in activity centres and other well-serviced locations is found in policies within the Planning Policy Framework at both the State and local level.
21	At the centre of the dispute between the parties is the design, height and scale of the development, in respect of both urban design and heritage considerations.
22	Relevant policies addressing urban design outcomes are detailed at clauses 15.01-1S and 15.01-2S.  Objectives include:
•	creating urban environments that are safe, healthy, functional, and enjoyable and that contribute to a sense of place and cultural identity
•	achieving building design outcomes that contribute positively to the local context and enhance the public realm.
23	Related strategies refer to:
•	requiring development to respond to its context in terms of character, cultural identity, natural features, surrounding landscape and climate
•	ensuring that the interface between the private and public realm protects and enhances personal safety
•	ensuring that development provides landscaping that supports the amenity, attractiveness and safety of the public realm
•	promote good urban design along and abutting transport corridors.
24	At the local level, the Municipal Strategic Statement (MSS) provides objectives and strategies for urban design at clause 21.05.  An objective is to retain the municipality’s identity as a low-rise urban form with pockets of higher development.
25	A further objective is to enhance the built form character of activity centres with strategies referring to requiring development to respect and not dominate existing built form; and requiring new development to consider the whole centre recognising that activity centres may consist of sub-precincts which may each have a different land use and built form character.
26	The purpose of the Heritage Overlay includes conserving and enhancing heritage places of natural and cultural significance and ensuring that development does not adversely affect the significance of the heritage place.  Relevant decision guidelines at clause 43.01-8 are:
•	The significance of the heritage place and whether the proposal will adversely affect the natural or cultural significance of the place.
•	Any applicable statement of significance (whether or not specified in this overlay), heritage study and any applicable conservation policy.
•	Whether the location, bulk, form or appearance of the proposed building will adversely affect the significance of the heritage place.
•	Whether the location, bulk, form and appearance of the proposed building in in keeping with the character and appearance of adjacent buildings and the heritage place.
•	Whether the demolition, removal or external alteration will adversely affect the significance of the heritage place.
27	The objective of clause 15.03 is to ensure the conservation of places of heritage significance.  Relevant strategies include:
Encourage appropriate development that respects places within identified heritage values.
Retain those elements that contribute to the importance of the heritage place.
Ensure an appropriate setting and context for heritage places is maintained and enhanced
28	Objective 14 at clause 21.05 of the MSS is to protect the municipality’s heritage places.  Amongst the related strategies are the following:
14.3	Protect the heritage skyline of heritage precincts.
14.6	Protect buildings, streetscapes and precincts of heritage significance from the visual intrusion of built form both within places and from adjoining areas.
14.8	Apply the Development Guidelines for sites subject to the Heritage Overlay at clause 22.02
29	The objectives of clause 22.02 include:
To conserve Yarra’s natural and cultural heritage.
To retain significant view lines to, and vistas of, heritage places.
To preserve the scale and pattern of streetscapes in heritage places.
To ensure that additions and new works to a heritage place respect the significance of the place.
30	The policy addresses demolition and new development in Heritage Overlays.  We will refer to this policy in our consideration of the proposal’s response to the heritage context in a later section of these reasons.
31	The decision guidelines of the Heritage Overlay require consideration of any applicable Statement of Significance.  A similar guideline exists at clause 22.02-7, which states that the responsible authority will consider the heritage significance of place or element as cited in the relevant Statement of Significance or Building Citation.
32	In this instance, a Statement of Significance exists and is included in the City of Yarra Review of Heritage Overlay Areas 2007 (Heritage Review).  The following extract from the Statement of Significance sets out why the precinct is significant:
Why is it significant
The South Fitzroy Heritage Overlay Area is significant:
•	As the earliest urban area outside the Melbourne City grid to be settled in the Melbourne municipality, with several buildings from the mid nineteenth century surviving as testimony to its early establishment;
•	For the unusually high number of early Victorian-era and some Regency period buildings, being generally simply detailed and a clear reflection of the early date of Fitzroy’s settlement.
•	As evidence of early government planning controls or Acts of Parliament, from the 1850s, that aimed to solve street alignment problems in this privately planned suburb, arising from a hitherto lack of co-ordination between neighbouring allotment owners;
•	As a good example of the successful application of the Act for Regulating Buildings and Party Walls, and for Preventing Mischiefs by Fire in the City of Melbourne (Melbourne Building Act 1849), which forced the use of fireproof construction and gave South Fitzroy a character distinct from other inner suburbs such as Richmond and Collingwood, that have a greater proportion of Victorian-era timber buildings.
•	As a substantially intact collection of predominantly mid to late nineteenth and early twentieth century building stock, interspersed with well preserved inter-war residential, commercial, retail and industrial buildings that contribute to the historical character of the area.
•	For the relatively large number of individually significant buildings, being predominantly solid masonry rather than clad with timber, largely as a result of the Melbourne Building Act, 1849
•	For the ornate and exuberant detail of many late nineteenth and early twentieth century buildings in the suburb, reflecting the affluence of many of the inhabitants of this area, particularly in the late 19th century.
•	For the early street, lane and allotment layouts, some original bluestone kerbs, paving and guttering, and some mature exotic street trees, providing an appropriate setting for this collection of residential, retail, commercial and industrial buildings.
•	For the landmark qualities of some large factory and warehouse buildings from the late 19th and earlier 20th century, such as the MacRobertson confectionary complex which are significant features in the skyline of this predominantly low rise suburb; and
•	For the major early institutions that developed on its fringes, in particular, St Vincent’s Hospital and The Convent of Mercy, as closely linked with the area’s history, education and welfare within the metropolitan area.
Proposed DDO32
33	The Council advised that, on 17 December 2019, it requested the Minister for Planning to approve interim Design and Development Overlays for activity centres in Collingwood and Fitzroy under section 20(4) of the Planning and Environment Act 1987.  The Design and Development Overlays form part of proposed Amendment C270 to the Planning Scheme, for which the Council has not yet sought authorisation from the Minister to prepare and place on exhibition.
34	Amendment C270 proposes to apply a new Schedule 32 of the Design and Development Overlay (DDO32) to that part of Johnston Street between Nicholson Street and Brunswick Street and specifies a mandatory 27.2 metre building height and a 14.4 metre street wall height.
35	At the time of the hearing, the Minister had not made a decision on the Council’s request for introduction of the interim DDO32.
36	At its meeting on 17 December 2019, the Council noted that work on the proposed permanent controls would take place in 2020 and requested that further engagement with the community be undertaken.
37	The Council did not submit that Amendment C270 should be considered as a seriously entertained planning proposal.  Rather, it submitted that the Amendment should be taken as an indication of the general scale of development that the Council is contemplating for the review site and this section of Johnston Street.  It referred to the Amendment and the supporting background document Johnston Street Built Form Framework 2019 as a ‘useful tool’.
38	In the applicant’s submission, Amendment C270 has not even progressed to a stage that could be described as ‘embryonic’ and should therefore not be given weight in the consideration and determination of this application.
39	We agree with the applicant that, given the stage of the Amendment, not having been adopted by the Council and yet to undergo the further community engagement referred to in the Council resolution, we are unable to give it weight.  That said, we agree with the Council that it does provide an indication of the scale of development which the Council desires to see in this section of Johnston Street, and this has been noted.
Does the proposed built form respond acceptably to the site’s physical and strategic context?
40	The Council opposes the development on the basis of its overall height, its scale and mass, and the height of the street wall.  The Council called evidence to show that Johnston Street in this precinct has a consistently low street wall, at least on the south side, and that the proposed street wall would stand above this, visually dominating the heritage character and placing undue emphasis on the Fitzroy Street corner.
41	The Council’s evidence and submissions are that the overall height and bulk of the tower elements are excessive and will visually dominate the broader heritage context, including the individually significant A.O.F. House of two storeys on the south-western corner of Brunswick Street and Johnston Street, and the Moran and Cato warehouse buildings to the south and south-east.
42	The respondents agree with the Council, and submitted that the impacts upon Brunswick Street and Johnston Street would be unacceptable and would undermine the value of these high character precincts which contribute towards a dynamic inner city economy that they say is highly dependent on the heritage character of the streets. 
43	The applicant disagreed.  In summary, it submitted that the robust forms of the Moran and Cato buildings provide a context for the proposed higher form.  In the applicant’s view supported by the evidence it called, the A.O.F. House is also a robust building that would still be able to be interpreted in its entirety despite the visibility of the taller form behind.
44	The applicant’s submission is that the increased upper-level setbacks are sufficient to moderate the visual impact of the tower to an acceptable degree, while the refined form and materiality of the tower would provide a recessive backdrop to the heritage buildings.  Reference was made to a number of similar developments proximate to the subject site, including a completed ten-storey mixed-use development on Johnston Street close to Smith Street, known as the Lyric development, as it is constructed on the site of the former Lyric Theatre.  It was submitted that Johnston Street has a relatively varied character and that there are many examples in the locality of a higher street wall adjacent to lower forms.
45	In the circumstances of this application, the assessment of the acceptability or otherwise of the proposal’s built form response is an interplay of urban design and heritage considerations.  The assessment is informed by the policy framework, the site’s context, the local heritage values and by the emerging pattern of development in the surrounding area.
46	Before proceeding to assess the proposed building, we note that the demolition of the existing building is not opposed by any party.  Although a permit is required for the demolition pursuant to the provisions of the HO334, the loss of the building will not adversely affect the significance of the heritage place.  The reason for this is that the building has been identified as being ‘not contributory’ in the Heritage Review.  Pursuant to clause 22.02-5.1, it is policy to generally encourage the retention of a building in a heritage place unless:
•	The building is identified as being not contributory
•	The building is identified as a contributory building, and
-	new evidence has become available to demonstrate that the building does not possess the level of heritage significance attributed to it in the incorporated document, City of Yarra Review of Heritage Areas 2007 Appendix 8 (as updated from time to time) and
-	the building does not form part of a group of similar buildings.
Note:	The poor condition of a heritage place should not, in itself, be a reason for permitting demolition.
47	The demolition of the existing building is acceptable and will not have an adverse impact on the significance of the heritage place.
48	We now turn to consider the proposed replacement building.
49	Objectives of clause 21.05 (urban design) were detailed earlier.  A related strategy is:
17.2	Development on strategic redevelopment sites or within activity centres should generally be no more than 5-6 storeys unless it can be demonstrated that the proposal can achieve specific benefits such as:
•	Significant upper level setbacks
•	Architectural design excellence
•	Best practice environmental sustainability objectives in design and construction
•	High quality restoration and adaptive re-use and heritage buildings
•	Positive contribution to the enhancement of the public domain
•	Provision of affordable housing
50	Policy for new development on land within a Heritage Overlay is provided at clause 22.02-5.7.1 and includes encouraging the design of new development and alterations and additions to a heritage place or a contributory element to a heritage place to:
•	Respect the pattern, rhythm, orientation to the street, spatial characteristics, fenestration, roof form materials and heritage character of the surrounding historic streetscape.
•	Be articulated and massed to correspond with the prevailing building form of the heritage place or contributory elements to the heritage place.
•	Be visually recessive and not dominate the heritage place.
•	Be distinguishable from the original historic fabric.
•	Not obscure views of principle facades. [sic]
•	Consider the architectural integrity and context of the heritage place or contributory element.
51	As is to be expected given the site’s physical and strategic context, this is a situation where the heritage and urban design issues overlap.  We agree that the position adopted in SMA Projects Pty Ltd v Yarra CC where an integrated assessment was used, is also appropriate in this situation. 
52	We therefore consider the key issues of built form by component, considering the heritage and urban design issues in response to the context.
Is the height of the proposed street wall to Johnston Street acceptable?
53	The proposal has a street wall to Johnston Street, with the tower element set back 5.0m, in what is effectively a podium and tower arrangement.  The street wall is four storeys at the eastern end, rising to seven storeys at the western end where the site intersects with Fitzroy Street.  We will discuss the corner element as a separate matter.
54	It is notable that in the original application plans the street wall and the corner element were one storey higher, that is five and eight storeys. Council submitted that despite the reduction, the street wall was still too high.  It relied upon the evidence of Mr Gard’ner who was of the view that the street wall should more closely align with the facade of the A.O.F. House to its east.  In his opinion, a three-storey street wall was necessary in order not to adversely impact upon the heritage values of the A.O.F. House.
55	Mr McPherson, supported the four-storey street wall as an appropriate response to the urban design context, noting that it was not uncommon to find differences of scale of one or more storeys in this precinct.  Mr Lovell gave similar evidence from a heritage perspective.  Mr Sheppard’s evidence is that the four-storey street wall will complement the adjacent heritage fabric and is consistent with the emerging street wall height.
56	We agree with Mr McPherson, Mr Lovell and Mr Sheppard that a four-storey street wall will provide an acceptable relationship to the existing context.  In particular we note:
•	the A.O.F. House returns around the Brunswick Street corner to terminate against the Moran and Cato office building.  With essentially the same façade details as found in Johnston Street, it appears to sit quite comfortably against a taller blank wall
•	we were informed that the subject site was previously occupied by the Regent Theatre.  We were shown several images that indicated the theatre would have been one or two storeys higher than the façade of the A.O.F. House, with a blank wall return essentially similar to the abutment with the Moran and Cato building
•	we accept that given the variation in scale evident in the heritage precinct, a one storey transition would not be unusual.
57	As a result, we consider that the four-storey street wall will not have any detrimental impact upon the heritage values of HO334 and is also an acceptable response in urban design terms.  It will sit comfortably within the streetscape and will not detract from the adjoining contributory heritage building.  It represents a scale which is reflective of existing and emerging development both within Johnston Street and the wider heritage precinct.  The one storey transition in height with the A.O.F. House is modest.  It will not present as a jarring or discordant element and is suitably respectful of the neighbouring heritage building.  We have not been persuaded that a further reduction in its height is warranted or justified.

Proposed Johnston Street elevation showing the four to seven storey “street wall”. Source: VCAT Planning Submission (Revision D) by Hayball Architects dated 10 August 2020
Is the height of the proposed street wall at the corner of Johnston and Fitzroy Streets acceptable?
58	The proposal has a higher street wall at its western end, rising from the four-storey street wall in the centre and eastern parts of the Johnston Street façade to seven storeys at the corner of Fitzroy Street.  The seven-storey treatment returns along Fitzroy Street before stepping down to five storeys where the development abuts the Moran and Cato warehouse building.
59	The architectural treatment of the higher corner element is essentially similar to the rest of the street wall, however there is a transition in materials and colour that corresponds approximately with the two-storey facades of the existing buildings on either side in Johnston Street.
60	The Council submitted that this corner treatment is too high.  Mr Gard’ner gave evidence that the corner treatment is out of scale with the two-storey facades of the row of Victorian shopfronts to the west of Fitzroy Street.  In his view the street wall should be reduced to three storeys for the entire frontage of Johnston Street, including the corner, to approximate the height of the existing facades of the heritage buildings.
61	Mr McPherson also agreed that the corner treatment was too high in urban design terms.  He noted that Fitzroy Street is a relatively narrow street with limited significance.  In his view, it is inappropriate to “mark” the corner to the extent shown as it gives undue prominence to this intersection.  He considers that the corner should be reduced in height by one storey to match the reduction he recommends for the tower element, as this would give a more appropriate scale for the corner while maintaining the proportion of the tower that is visible behind the street façade.
62	In Mr McPherson’s opinion, if the Tribunal were to consider further reducing the street wall, consideration should also be given to the treatment of the exposed tower façade behind.
63	In contrast Mr Sheppard, describing this element as the seven-storey ‘accent’, considers that it will contribute to the varied streetscape character (with reference to a similar outcome at the Lyric development).  His evidence is that without this variation in height, a uniform four-storey street wall would be uncharacteristically consistent for this length of street frontage.
64	We agree with the Council that a significant reduction in the height of the corner street wall is required, for the following reasons:
•	at its present height, the corner will read as a tower element or ‘marker’ that is out of proportion to Fitzroy Street
•	Fitzroy Street is not a major street that warrants such a marker
•	the corner element would be out of scale with the heritage shopfronts to the west of Fitzroy Street
•	the photomontage images indicate that the corner element would visually distract from the heritage context.
65	That said, we agree with the applicant that within this precinct it is not unusual to have a one-storey difference between new buildings and a heritage context.  We also agree that some increase at the corner will add interest to the Johnston Street façade. 
66	For these reasons we find the corner element should be reduced to provide an approximate one-storey ‘step up’ from the street wall.  This suggests the corner element should be a maximum of five storeys (as compared to the seven storeys presently shown).
67	An outcome of this change would be more of the screen wall of the tower would be visible, notwithstanding a reduction in its height, as detailed earlier.  We consider this could still result in an acceptable relationship, subject to final design detail and informed through appropriate further visualisation.  We expect that if the additional tower visibility is of concern, there is potential to reduce the visual impact through design detail including a variation in materials and/or colours.  We observe, however, that more substantial consequential built form changes may be required.

Proposed seven storey element at the corner of Johnston Street and Fitzroy Street.  Source: Evidence of Mr C Goss of Orbit Solutions Pty Ltd, 7 September 2020; View 1.1 (without landscape)
Are the tower and penthouse visually dominant?
68	The Council and respondents submitted that the tower element will be visually prominent to the point where it will adversely impact the heritage values of the context, and undermine the effectiveness of the four-storey street wall.  They submitted that the upper forms as proposed would be disruptive to the Johnston Street context, which is presently composed of low scale and fine-grain development on the south side.  Reference was made to the fact that, while there are a number of larger infill developments on the north side of Johnston Street, none rise to the height proposed here.
69	Further, concerns were raised that the taller elements of the building would ‘tower’ over the Brunswick Street intersection, to the point where it would be visually dominant and undermine the heritage values of this precinct. 
70	Mr Gard’ner’s evidence is that a substantially smaller tower is required to provide a suitable response to the heritage context.  In his opinion, two floors should be removed from the tower and one floor from the penthouse. This would take the overall development from eleven storeys to eight.
71	Mr McPherson was of a similar view, except his evidence was that one storey should be removed from the tower and one storey from the penthouse, for an overall height of nine storeys.  In his opinion, this would provide a suitable response to the heritage context.  In addition, he provided an analysis that suggested the emerging built form within this precinct is in the order of six to eight storeys with a five-storey street wall.  Mr McPherson was satisfied that with the penthouse recessed and reduced in height, and a level removed from the tower element, the proposal at this height would fit within this emerging context.
72	The applicant agrees that the tower and penthouse will be visually prominent, but disagrees that this will rise to the point of dominating the heritage context.  It submitted that the A.O.F. House has a prominent street façade that will still be clearly visible and able to be interpreted with built form behind it.  It submitted that this is enhanced by the design character of the tower and penthouse, which are simple in form with a uniform façade treatment that ensures they will be visually recessive.  This position is supported by the evidence of Mr Sheppard, who considers that the height, form, scale and materiality achieve an acceptable urban design outcome in the context of the review site.
73	The applicant noted there are recent developments of similar scale that demonstrate the ability for larger new development to sit comfortably within a heritage context.  Reference was made to the Lyric development, which was designed by the same architects and constructed by the applicant.
74	In the applicant’s submission, the Lyric development is very similar in both design and context.  It rises to 10 storeys behind a lower street wall, and abuts a heritage building to its east.  It was submitted that Smith Street is a sensitive heritage corridor, and that this example establishes the precedent that higher built form can be acceptable as a visible backdrop to significant heritage buildings.
75	In respect of the Lyric development, we agree it illustrates that visibility itself, even to the point of visual prominence, does not by itself rule out a development adjacent to sensitive heritage buildings.
76	The question remains, when does visual prominence become dominance to the point where it has an unacceptable impact upon the heritage context?  We accept the broad principle that a prominent street wall together with a visually recessive tower that rises above a five to six storey suggested height detailed at strategy 17.2 of clause 21.05-2 can be an acceptable outcome.  In saying this we have had regard to, amongst others, the proposed upper level setbacks, the high-quality architecture, and the positive contribution to the public realm by virtue of the attractive design and active interfaces to both Johnston Street and Fitzroy Street.  A further consideration is the ability to achieve best practice environmental sustainability outcomes.
77	However, we also find that it does not assist us to determine the number of storeys above the suggested height that will be acceptable in this particular case.  Only examining the particular context of the subject site can the number of storeys above the suggested height that will be acceptable in this case be determined.
78	As detailed earlier, it is policy to encourage the design of new development to be visually recessive and dominate the heritage place.  We agree with Mr Gard’ner and Mr McPherson that the tower will appear as visually dominant behind the significant A.O.F. House.  At the proposed height, from the north east corner of the Johnston Street and Brunswick Street intersection the tower and penthouse will detract from the corner element of the A.O.F. House.  This is evident in the photomontage evidence in View 2 (below), an impression that we were able to confirm in our site inspection.
79	We also note that while the photomontage illustrated the tower as a singular form that could be described as minimalist, we were advised that the external cladding comprises a series of adjustable screens that individual apartments can adjust depending on the weather and personal requirements. While this could add to the visual interest of the development, we are concerned that it could also potentially undermine the ability of the tower to present as visually recessive.
80	In addition, from further to the east, as shown in photomontage View 6, we find that due to its scale the proposed tower will reduce the viewer’s ability to interpret the location of the Johnston Street and Brunswick Street intersection.
81	From the west, the building will have undue prominence (arguably approaching dominance) by virtue of the seven-storey corner element, which we address below, and the overall height of the tower itself.  It is substantially higher than any of the multi-level developments, of relatively recent origin, on the north side of Johnston Street.  It will appear notably out of scale within its context, as a consequence of both its height and mass.  The upper-level setbacks and materials/finishes are not sufficient to ameliorate this visual impact to an acceptable level.  It is not visually recessive and will dominate its immediate context.
82	For these reasons, we find that that part of the building comprising the tower and penthouse is too tall.  In order to achieve an acceptable outcome, it needs to be lower.  Mr McPherson found that the tower should be reduced by one storey and the penthouse by one; whereas Mr Gardn’er found that the tower should be reduced by two storeys and the penthouse by one.  Part of his concern was the extent of tower wall that would be exposed behind a three-storey street wall.
83	We have found that the street wall can be retained at four storeys.  As a result, with a single storey taken out of the tower as recommended by Mr McPherson, the extent of wall visible behind the street wall would be similar in extent to that recommended by Mr Gard’ner.
84	We consider that if the tower and penthouse are reduced by one storey each, the visual bulk that will appear behind the A.O.F. House will be reduced to an acceptable level.
85	We note that the face podium treatment is carried around to the south-east corner of the building, as can be seen in the photomontage visualisation below.  We find that this element must also be reduced by one storey in order to reduce its visual impact behind the A.O.F. House.
86	As a result, we find that the reductions proposed by Mr McPherson will be sufficient to ensure a satisfactory relationship to both its heritage and its urban design context.

Proposed built form behind the A.O.F. House from the north-east corner, Johnston Street and Brunswick Street.  Source: Evidence of Mr C Goss of Orbit Solutions Pty Ltd, 7 September 2020; View 2.1 (without landscape).
Is the transition to the Moran and Cato Warehouse building acceptable?
87	The plans show the street wall treatment returning on the western façade facing Fitzroy Street, stepping down from the seven-storey corner element to five storeys as it abuts the Moran and Cato warehouse (95-105 Victoria Street, Fitzroy).
88	This aspect of the proposal was supported by Mr Gard’ner in his written evidence as circulated.  However, after viewing the photomontage evidence, he revised his opinion.  Mr Gard’ner advised that his original opinion was based upon the circulated plans which indicated that the parapet of the Moran and Cato warehouse was at a height RL 44.270 (a height above pavement level of 17.87m).  This would be approximately equal to the proposed podium height of five storeys.
89	View 3 of the photomontage evidence, however, clearly indicates that the parapet of the warehouse was significantly lower than this, and Mr Gard’ner was able to verify this by reference to the endorsed drawing prepared for alterations and additions to the warehouse.  This indicated a parapet height of 14.380m, approximately equivalent to four storeys of the proposed podium.
90	Mr Gard’ner said it was his view that the street wall height along Fitzroy Street should transition or ‘step down’ from the taller, more massive heritage forms on the north side of Victoria Street to the lower two to three-storey scale of Johnston Street. 
91	As a result, he said the street wall should be reduced to four storeys to match the parapet of the warehouse and provide a transition to Johnston Street if his recommendation for a three-storey street wall to Johnston Street, returning into Fitzroy Street, is accepted.
92	We are not persuaded that it is necessary to reduce the parapet where it abuts the warehouse building for the following reasons:
•	Fitzroy Street is relatively narrow and offers limited opportunities to compare Victoria Street to Johnston Street
•	the Moran and Cato warehouse addresses Victoria Street, and the façade to Fitzroy Street is a side elevation with limited articulation.
93	As we have noted elsewhere, we find it is generally acceptable for a new development to vary by a storey where it adjoins a heritage building.  In this case the heritage building is a relatively robust building that we find will not be adversely impacted by the proposed transition. 
         
Proposed built form relationship to the Moran and Cato warehouse building, corner of Victoria Street and Fitzroy Street.  Source: Evidence of Mr Goss of Orbit Visualization, 7 September 2020; View 3.1 (without landscape)

Is the treatment of the lane abuttal acceptable?
94	An existing lane runs along the western boundary of the A.O.F. House, connecting to Johnston Street through an opening in the façade and with an existing boundary wall for part of the depth.
95	The plans indicate that the podium is set back from the boundary to create a recess with openings through the boundary wall, allowing views through to the new retail premises from the lane.
96	While the openings in the boundary wall and additional pedestrian space were seen as positive elements by all parties, Mr Sheppard raised a concern that the depth of the recess, with a services cabinet at its southern end, could create an unsafe place.  The location of bicycle parking in the opening would also partially restrict views and limit movement.
97	Mr Sheppard recommended that the recess be re-configured to reduce its depth and increase its width.  We agree.
98	We also observe it would be desirable to allow some pedestrian movement through the openings, subject to some of the bicycle parking being able to be relocated.
Is the presentation of the retail frontage to Johnston Street acceptable?
99	The Council was of the view that the ground floor treatment to Johnston Street requires further refinement.  It relied on the evidence of Mr McPherson who considers the extent of glazing divided by relatively narrow columns would result in an unbalanced appearance, with the heavy masonry panels above appearing to lack support.  He recommended that the columns be replaced with piers or wall elements to bring some of the scale of the upper façade down to street level.
100	While we agree that wider piers of wall elements could provide an attractive presentation at street level, we are not persuaded this is necessary for the following reasons:
•	the columns vary in plan form, with the majority projecting significantly beyond the glazing line.  Thus, other than from directly in front, they would appear to have a significant degree of “solidity”
•	a canopy extends continuously across the Johnston Street façade, so that the pedestrian on the footpath adjacent is unlikely to perceive a direct relationship between the street level and the upper façade
•	the proposed ground floor façade includes horizontal design elements at both the base and top of the display windows, which we find will add to the apparent solidity of the retail frontage and provide a contemporary re-interpretation of the traditional shopfront.
        
Proposed Johnston Street ground floor façade – North-east corner. Source: VCAT Planning Submission (Revision D) by Hayball Architects dated 10 August 2020

Is sufficient car parking provided and will there be any unacceptable traffic impacts?
101	It is proposed provide a total of 124 car spaces within the four-level basement.  Of these, 102 spaces are to be allocated to residents with the remainder being for the shop use.  No on-site residential visitor car parking is proposed.
102	Pursuant to clause 52.06-5, the development attracts a car parking requirement of 148 spaces (105 spaces for residents and 38 spaces for the shops).  Accordingly, there is a shortfall of three residential spaces and 16 retail spaces.  As the review site is within the Principal Public Transport Network Area, there is no requirement for the provision of visitor car parking.
103	The evidence included a demand assessment, utilising empirical data, which indicated a demand for 4 – 8 visitor car spaces and 25 car spaces for the retail component.  The former utilised a rate of 0.05 to 0.1 car space per dwelling and the latter a rate of 2.3 spaces per 100 square metres, having regard to the site’s locational characteristics.  These include a high level of accessibility to nearby commercial uses (allowing for multi-purpose trips), public transport services and pedestrian/cyclist pathways.  The car parking for the retail component comprises 11 staff spaces (adopting a rate of 1.0 car space per 100 square metres) and 14 customer spaces.
104	Based on the demand assessment, the evidence is that the development meets the long-term parking demand of 113 spaces (102 spaces for residents and 11 spaces for retail staff) and at least half of the short-term visitor/customer demands (11 spaces).  The demand for the additional 7 – 11 short-term spaces can be met on-street, with car parking survey data showing the availability of up to 38 car spaces.
105	The Council has not raised any concerns regarding the car parking provision or the traffic impacts of the proposal.  While preferring the provision of fewer on-site car spaces in favour of sustainable transport and affordable housing, the Fitzroy Residents Association Inc agrees that the provision of visitor as well as resident and staff parking will alleviate pressure on the available on-street parking.
106	Based on the evidence we consider that the proposed car parking provision is acceptable.  The site is accessible to alternative transport modes and its location within an activity centre facilitates multi-purpose trips.  There is sufficient capacity in the available on-street parking to accommodate any demand generated by customers and residential visitors.
107	With the exception of a section of the ramp at a gradient of 1:4 compared to the required 1:5, the design of the basement car park meets the requirements of clause 52.06-9.  We were not provided with any compelling reason why the ramp gradient should not be compliant with clause 52.06-9.  We conclude that the gradient should be made to comply, given it will provide access to customer car parking.  The only consequential change arising from modifications to achieve compliance would be a relatively minor reduction in the retail floor space to provide the necessary clearance.
108	The visibility splay specified in clause 52.06-9 is not provided.  We accept that it is not required on the northern side of the ramp as an exiting vehicle has the benefit of the space created by the entry lane to view any pedestrian approaching from the north.  The 1.4 metre setback from the western site boundary, however, is not sufficient to provide the necessary sightlines and will not allow an exiting driver to see a pedestrian approaching from the south.
109	According to the evidence, the additional traffic generated by the development can be accommodated without any unacceptable impacts on the operation or efficiency of the surrounding street network.  We have no evidence to the contrary and the Council did not raise any concerns regarding the traffic impacts.
Will the development result in any unacceptable wind impacts?
110	The evidence on the proposed wind impacts provides the following conclusions:
•	the wind conditions for the development have been shown to satisfy the walking criterion in the surrounding streetscape
•	the wind conditions outside the retail and residential entrances have been shown to satisfy the walking criterion
•	with the installation of 2.0 metre high balustrades, the wind conditions on the terraces on level 9 will satisfy the walking criterion.
111	The key concerns relating to the wind impacts are in respect of the rooftop communal open space area.  The evidence is that walking criterion is an acceptable outcome for this area.  The Council does not agree, arguing that sitting criterion should be achieved.
112	The rooftop space is an important area and will make a notable contribution to residents’ amenity given its size, proportions, landscaping, opportunity for views and solar access.  It will provide an attractive option for occupants and their visitors as an alternative to the individual balconies.
113	According to the evidence, it is possible to create areas within the rooftop communal open space that achieve the sitting criteria, with reference being made to the use of vegetation and screens.  We consider that an acceptable outcome would be achieved by ensuring that the designated sitting area (comprising a table and seating) is designed to meet the sitting criterion in order for occupants to experience comfortable conditions while in this part of the rooftop open space.  This outcome would be conducive to the intended use and provide an acceptable level of amenity to encourage residents to occupy this area.
Does the proposal provide equitable development opportunities for adjoining land?
114	The substituted plans include a minimum 4.5 metre eastern setback from the midpoint of the laneway for part of Level 1 and for all levels above.  As a consequence of this, the Council advised that it no longer pursued its ground relating to equitable development.
115	Subject to a modification to Dwelling 104 to provide the same setback to the windows and terrace, we agree that the proposal will provide adequate equitable development opportunity for the land to the east.
116	The property to the south is occupied by the substantial Moran and Cato buildings which are used for non-residential purposes.  In acknowledgment of the potential for the construction of upper level additions to at least the lower of the two buildings, the development incorporates minimum 4.5 metres setbacks from the southern boundary for Levels 5 and above.  This is an acceptable response.
will the development provde an acceptable level of Internal amenity for occupants?
Daylight
117	Having considered the evidence and the recommendations it contains, which the applicant accepts, the Council did not pursue its ground relating to internal amenity with respect to daylight to dwellings.  The assessment of the plans detailed in the evidence is that dwellings on the lower levels experience significant daylight constraints due to the following factors:
•	insufficient setbacks from the neighbouring built form to the south
•	excessive room depths
•	adverse effects of balcony overhangs and façade projections
•	low material reflectance values
•	inappropriate window size and location
•	suboptimal internal room layouts.
118	To overcome these constraints and improve daylight levels in the open plan living areas and bedrooms, changes to the design of apartments in the lower levels were recommended.  The changes mean that all living bedrooms and living spaces would comply with the relevant best practice daylight factor threshold in BESS with the existing conditions on adjoining land.  However, in the modelling of what was referred to as an ‘equitable development scenario’ the living areas of seven dwellings would not meet this threshold.
119	BESS stipulates that 80% of dwellings need to comply with the best practice daylight factor threshold.  As 70 out of 77 of the dwellings would comply, this equates to 90%, and would therefore be an acceptable outcome.
Noise
120	The acoustic evidence addressed noise from plant and equipment, music noise and patron noise from the nearby live music venues.
121	In respect of noise from plant and equipment, the evidence is that with the provision of appropriate glazing and the installation of acoustic screens to balconies, compliance with State Environment Protection Policy (Control of Noise from Commerce, Industry and Trade) No. N-1 will be achieved.
122	Clause 53.06 details the provisions relating to Live Music Entertainment Venues.  The purpose of this clause is:
To recognise that live music is an important part of the State’s culture and economy. 
To encourage the retention of existing and the development of new live music entertainment venues. 
To protect live music entertainment venues from the encroachment of noise sensitive residential uses. 
To ensure that noise sensitive residential uses are satisfactorily protected from unreasonable levels of live music and entertainment noise. 
To ensure that the primary responsibility for noise attenuation rests with the agent of change.
123	There are two live music entertainment venues in the vicinity of the review site.  One is located 20 metres to the north-east, on the opposite side of Johnston Street; the other is on the rooftop of the commercial building located on the north-west corner of Brunswick Street and Victoria Street (directly adjacent and to the south-east of the review site).
124	Clause 53.06-1 applies to an application to construct a building or construct or carry out works associated with a noise sensitive residential use that is within 50 metres of a live entertainment venue.
125	Pursuant to clause 53.06-3:
A live music entertainment venue must be designed, constructed and managed to minimise noise emissions from the premises and provide acoustic attenuation measures that would protect a noise sensitive residential use within 50 metres of the venue. 
A noise sensitive residential use must be designed and constructed to include acoustic attenuation measures that will reduce noise levels from any: 
•	Indoor live music entertainment venue to below the noise limits specified in State Environment Protection Policy (Control of Music Noise from Public Premises) No. N-2 (SEPP N2). 
•	Outdoor live music entertainment venue to below 45dB(A), assessed as an Leq over 15 minutes. 
For the purpose of assessing whether the above noise standards are met, the noise measurement point may be located inside a habitable room of a noise sensitive residential use with windows and doors closed (Schedule B1 of SEPP N2 does not apply). 
A permit may be granted to reduce or waive these requirements if the responsible authority is satisfied that an alternative measure meets the purpose of this clause. 
126	Accordingly, the assessment against SEPP N-2 is to be based on measurements within habitable rooms with doors and windows closed.  The evidence is that, with the installation of appropriate glazing, compliance with SEPP N-2 will be achieved.  This is similarly the case for patron noise emanating from the adjacent roof-top venue to the south-east of the site.
127	The draft conditions included a requirement for a further acoustic report providing an assessment of mechanical noise from nearby premises as measured on the balconies and requiring the installation of attenuation devices, if necessary.
128	Acoustic impacts will need to be re-assessed as part of any future application as the acoustic conditions of the site’s context may have altered from the time the assessment contained in the evidence was undertaken.
Conclusion
129	For the reasons given above, we have concluded that a permit should not be granted for the proposed development.  It will not represent an acceptable planning outcome in heritage and urban design terms when assessed against the relevant policies and provisions of the Planning Scheme.
130	We acknowledge that there is strategic support for intensification on this site, and that the demolition of the existing building is acceptable.  We also find there are many positive aspects of the proposed development, including the activation of the Johnston Street frontage and the generally high quality of the architecture and the materials and finishes.
131	We have identified in some detail changes that we find should be made to achieve an acceptable built form.  However, we consider these go beyond what can be addressed by permit conditions.  Modification is required to all three principal components of the building – the street wall, the central tower and the penthouse – and will affect the overall composition and appearance of the development.  The changes may result in unforeseen outcomes.
132	Careful consideration needs to be given to the resultant form, massing, architecture and materiality of a building which is modified in accordance with our findings.  This is appropriately addressed in the form of a new planning application.  This would provide Council with the opportunity to undertake a detailed assessment with input from experts.  It will also allow respondents and other potentially affected persons to participate in the planning permit application process, responding to the new form of the development.

Bill Sibonis
Senior Member		Stephen Axford
Member