Background
JHP Property Development Pty Ltd applied to the City of Sydney Council for development consent to partially demolish an existing building at 89 Macleay Street, Potts Point, and construct a 7-storey mixed-use development comprising ground-floor retail, residential apartments above, and a rooftop communal open space and swimming pool. The Council refused Development Application D/2024/1237, prompting JHP Property to appeal to the Land and Environment Court under s 8.7 of the Environmental Planning and Assessment Act 1979 (NSW).
The site is zoned MU1 Mixed Use under the Sydney Local Environmental Plan 2012 (SLEP). A key issue was that the proposed building reached 23.749 m in height, exceeding the 22 m maximum permitted by cl 4.3 of the SLEP. The applicant sought to justify this departure under cl 4.6 of the SLEP. The site also sits within a heritage conservation area and in the vicinity of heritage items, and the development involved a component of affordable housing, engaging several State Environmental Planning Policies.
Prior to the conciliation conference convened on 19 June 2026, the parties reached an in-principle agreement based on amendments to the development application, including a reduction from 7 to 6 storeys in the approved form, and filed a signed agreement with the Court on 10 June 2026 under s 34(10) of the Land and Environment Court Act 1979 (NSW).
The Court’s Holding
Commissioner Horton upheld the appeal and granted development consent for the amended 6-storey mixed-use development, subject to conditions set out in Annexure A. Acting under s 34(3) of the Land and Environment Court Act 1979, the Commissioner was required to give effect to the parties’ agreed decision, being satisfied it was one the Court could have made in the proper exercise of its functions. The Commissioner expressly noted that no independent merit assessment of the originally disputed issues was made.
The Commissioner upheld the cl 4.6 request to vary the height standard, finding that the exceedance — confined to the lift overrun, stair enclosure, and roof shade structure, all set back from the building perimeter — was unreasonable to enforce in the circumstances and was supported by sufficient environmental planning grounds. The encroachments involved no habitable floor space and would have minimal visibility from the public domain, with no adverse impact on nearby heritage items or the heritage conservation area. The Commissioner was also satisfied that all relevant jurisdictional prerequisites under the SLEP and applicable State Environmental Planning Policies — including those addressing housing, biodiversity and conservation, resilience and hazards, and sustainable buildings — were met.
The applicant was ordered to pay the Council’s agreed costs of $2,000 within 28 days of receipt of an invoice, pursuant to s 8.15(3) of the Environmental Planning and Assessment Act 1979.
Key Takeaways
- A cl 4.6 variation to a height standard can be upheld where the exceedance is limited to non-habitable rooftop structures (lift overrun, stair enclosure, shade structure) that are set back from the perimeter and have negligible visual impact on heritage items or a heritage conservation area.
- Under s 34(3) of the Land and Environment Court Act 1979, a Commissioner must give effect to a conciliated agreement between the parties without conducting an independent merit assessment, provided the agreed decision is within the Court’s power to make.
- Mixed-use developments incorporating affordable housing engage multiple State Environmental Planning Policies simultaneously; satisfaction of each policy’s prerequisites — including the Housing SEPP’s affordable housing mitigation requirements, monetary contributions, and qualified designer verification — must be demonstrated before consent is granted.
- A site within a heritage conservation area but not itself listed as a heritage item can achieve heritage acceptability by retaining and restoring contributory historic fabric that addresses the public domain streetscape.
Why It Matters
This decision illustrates the Land and Environment Court’s approach to conciliation-based resolution of development appeals in Sydney’s inner-city mixed-use zones. It confirms that minor technical exceedances of height controls attributable solely to rooftop plant and service structures — with no habitable floor space and minimal public visibility — can satisfy the cl 4.6 justification test, even in sensitive heritage settings such as Potts Point’s heritage conservation area on Macleay Street.
The case also serves as a practical checklist for complex urban infill proposals: developers must demonstrate compliance with, or justified variation from, the SLEP’s quantitative controls while simultaneously satisfying the layered requirements of the Housing, Biodiversity and Conservation, Resilience and Hazards, and Sustainable Buildings SEPPs. The parties’ ability to settle before the conciliation conference — reducing the building from 7 to 6 storeys and agreeing on conditions — underscores the utility of the Court’s conciliation process as an efficient alternative to contested merits hearings in Class 1 development appeals.