Background
Brett James Hogan applied to Newcastle City Council for development consent (DA2025/00383) to convert an existing building at 21 William Street, Hamilton into a 10-room co-living housing development, together with alterations, additions, and associated site works. The site is a local heritage item — the Wesley Church Hall (Item 157) — located within the Hamilton Business Centre Heritage Conservation Area and zoned R3 Medium Density Residential under the Newcastle Local Environmental Plan 2012 (NLEP). The council did not determine the application within the statutory period, giving rise to a deemed refusal, and Hogan lodged a Class 1 appeal in the Land and Environment Court on 3 December 2025 under s 8.7 of the Environmental Planning and Assessment Act 1979 (NSW).
The matter proceeded to a conciliation conference before Acting Commissioner Miller, held over two sessions on 7 April and 11 June 2026. During the course of the proceedings, the applicant amended the development application — revising the architectural plans and supporting technical reports including a Heritage Interpretation Plan, access report, traffic and parking letter, CPTED report, and waste management plan — which the council approved pursuant to s 38(1) of the Environmental Planning and Assessment Regulation 2021 (NSW).
A notable planning complexity was that the site’s lot size of 257 m² fell well short of the 800 m² minimum required for co-living housing in the R3 zone under s 69 of the State Environmental Planning Policy (Housing) 2021 (HSEPP). The applicant lodged a written variation request under cl 4.6 of the NLEP to justify departure from the minimum lot size standard, citing site constraints and the heritage building to be retained and adaptively reused.
The Court’s Holding
The parties reached agreement under s 34(3) of the Land and Environment Court Act 1979 (NSW) on terms acceptable to both sides. Acting Commissioner Miller was satisfied that the agreed decision — granting development consent subject to conditions — was one the Court could have made in the proper exercise of its functions, as required by the statutory test under s 34(3). Accordingly, the appeal was upheld and consent granted in accordance with the agreed terms set out in Annexure A.
The Commissioner reviewed the jurisdictional preconditions in detail. The proposal complied with the applicable height limit (not exceeding the existing building height of 10 m) and floor space ratio (1.008:1 against the 1.5:1 maximum). The heritage impact was accepted as satisfactory on the basis of the Nelson Heritage Consulting reports. Flood planning, acid sulfate soils, contamination, and BASIX sustainability requirements were each found to be met. While the proposal did not comply with certain non-discretionary standards in s 68 of the HSEPP — relating to communal open space, parking, and deep soil — the Commissioner accepted these shortfalls as appropriate given the site’s existing constraints and the heritage building being retained.
On the minimum lot size variation, the Commissioner accepted the cl 4.6 variation request as well founded in the circumstances. The applicant was also ordered to pay costs “thrown away” by the council as a result of the mid-proceedings amendment to the development application, pursuant to s 8.15(3) of the EPA Act.
Key Takeaways
- Co-living housing applications that fall short of the minimum lot size standard under s 69 of the HSEPP may still obtain consent where a well-founded cl 4.6 NLEP variation request is lodged, particularly where existing site constraints (such as a retained heritage building) make strict compliance unreasonable.
- Non-compliance with the non-discretionary development standards in s 68 of the HSEPP (communal open space, parking, deep soil) does not automatically defeat a co-living application; the consent authority may accept lesser provision where site-specific circumstances justify it.
- Applicants who amend their development application during LEC Class 1 appeal proceedings risk a costs order under s 8.15(3) of the EPA Act for costs thrown away by the other party as a result of that amendment.
- Where parties reach agreement at a conciliation conference under s 34 of the LEC Act, the presiding Commissioner must be satisfied the agreed decision is within the Court’s jurisdiction but is not required to conduct a full merits assessment under s 4.15 of the EPA Act.
Why It Matters
This decision illustrates how the NSW planning system can accommodate co-living housing — a housing type promoted by state policy to increase dwelling diversity — even on constrained heritage sites that do not meet standard development thresholds. The outcome confirms that the cl 4.6 variation pathway remains available to co-living proposals under the HSEPP framework, and that adaptive reuse of heritage buildings for diverse housing can satisfy both planning and heritage objectives with appropriate expert input.
The costs order for thrown-away costs also serves as a practical reminder to applicants in Class 1 proceedings: material amendments made after an appeal is lodged carry a real procedural cost, and parties should ensure their development applications are as complete as possible before initiating LEC proceedings.