In yet another step in the Como Hotel redevelopment saga, the State Administrative Tribunal has ruled in favour of ALH Group Property Holdings’ (ALH) application to extend the period in which its refurbishment and redevelopment is to be substantially commenced.
According to Squire Patton Boggs partner Margie Tannock, who represented ALH, this case has important findings and commentary for the development industry and specifically those involved in hospitality.
Background to the Dispute
ALH was granted development approval in 2015 for alterations to the existing Como Hotel and to replace the existing BWS bottle shop with a larger Dan Murphy’s store. It was given only 24 months to substantially commence work before the development approval lapsed in April 2017. Before being able to substantially commence work, ALH was required under the Liquor Control legislation to obtain a variation to its tavern licence. That process remains on foot after two and a half years. ALH sought to extend the period for substantial commencement, to allow more time for the Liquor Commission to make its decision before work could begin on site. The City of South Perth opposed the extension and responded by amending its planning scheme to prevent the development being capable of approval. It also requested from Main Roads, and Main Roads agreed to carry out road works to reduce vehicular access to the site. On the recommendation of the city and Main Roads, the Metro Central Joint Development Assessment Panel refused ALH’s request for an extension in February this year. On review of that decision, the tribunal determined that an extension of time was necessary and that the original 24 months was wholly inadequate.
Judicial Observations and Their Implications
In granting an extension to the substantial commencement period, Judge David Parry made significant judicial observations in regard to:
The complex, expensive and lengthy conflict that is the Western Australian experience of separate planning and liquor approval processes
The increasing levels of intervention of Main Roads Western Australia in land use and planning approvals in Western Australia
A major precedent for applications extending the time allowed for the commencement of development
Ms. Tannock commented: “Our clients are thrilled with this decision. The decision has created a precedent that broadens the range of considerations to be taken into account when assessing ‘substantial commencement’. This brings much-needed flexibility and a more sensible approach to the exercise of discretion to extend a lapsed development approval, especially whether other regulatory processes are at play.”
This is particularly significant where a developer is also awaiting liquor licensing approval and on this note, His Honour also made significant observations.
The tribunal determined in this case it was entirely reasonable and appropriate for the ALH to await the outcome of the liquor licence process before proceeding to expend significant money and resources on aspects such as preparing detailed architectural plans to obtain a building licence.
The tribunal appears to be critical of the sequential process the hospitality industry is required to follow under the Planning and Development Act 2005 and then the Liquor Control Act 1988 when seeking to redevelop licensed premises. Developers cannot be criticised for requiring an extension to a lapsed development approval when the liquor licensing process has held up progress of the development.
This decision also presents interesting considerations for Main Roads WA, for local governments’ deference to Main Roads, and for developers who find themselves frustrated by Main Roads’ role in the planning process.
Ms. Tannock said that Main Roads’ assertion that traffic volumes at the site has increased significantly since the development was originally approved in 2015 was baseless and provided no justification for a refusal of the application.
