270 Devonshire Street Pty Ltd v The Council of the City of Sydney [2026] NSWLEC 1554

Catchwords: DEVELOPMENT APPLICATION – mixed use building – alterations – conciliation conference – heritage – variation for FSR – agreement between the parties. Land and Environment Court New South Wales Medium Neutral Citation: 270 Devonshire Street Pty Ltd v The Council of the City of Sydney [2026] NSWLEC 1554 Hearing dates: Conciliation conference held on 11 June, 27 July 2026, 11 August 2026 Date of orders: 27 August 2026 Decision date: 27 August 2026 Jurisdiction: Class 1 Before: Creagh AC Decision: The Court orders that : (1) The appeal is upheld . (2) The Applicant ’ s written request pursuant to cl 4.6 of the Sydney Local Environment al Plan 2012 seeking a variation to the development standard for floor space ratio is upheld. (3) Development Application No. D/2025/1158 for alterations to the ground floor of the existing three-storey warehouse building, and approval for use of the ground - floor as a cafe at 268-274 Devonshire Street, Surry Hills (Lots 2, 3, 4 and 5 in DP 6533) is determined by the grant of consent subject to the conditions at A nnexure A. Catchwords: DEVELOPMENT APPLICATION – mixed use building – alterations – conciliation conference – heritage – variation for FSR – agreement between the parties. Legislation Cited: Environmental Planning and Assessment Act 1979 (NSW) , ss 4 .15, 4.16, 8.7, 8.15 Land and Environment Court Act 1979 (NSW), s 34 Environmental Planning and Assessment Regulation 2021 (NSW), s 38 State Environmental Planning Policy (Biodiversity and Conservation) 2021 , Pt 6.2, Div 2 State Environmental Planning Policy (Resilience and Hazards) 2021 , s 4.6 Sydney Local Environmental Plan 2012 , cll 4.4, 4.6, 5.10, 6.21C, 7.14 Cases Cited: McMillian v Taylor (2023) 111 NSWLR 634 ; [2023] NSWCA 183 Category: Principal judgment Parties: 270 Devonshire Street Pty Ltd (Applicant) The Council of the City of Sydney (Respondent) Representation: Counsel: G Shapiro (Solicitor) (Applicant) A Stipcevic (Solicitor) (Respondent) Solicitors: Hones Lawyers Pty Ltd (Applicant) City of Sydney Council (Respondent) File Number(s): 2026/28321 Publication restriction: Nil JUDGMENT COMMISSIONER : This appeal concerns a development application for alterations to the ground floor of an existing three-story warehouse building at 268-274 Devonshire Street, Surry Hills, and approval for use of the ground floor as a cafe . Pursuant to s 8.7 of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act), the appeal was commenced against the deemed refusal of th at application . In exercising the functions of the consent authority in relation to the appeal, the Court has the power to determine the development application pursuant to ss 4.15 and 4.16 of the EPA Act. The Court was required to arrange a conciliation conference under s 34 of the Land and Environment Court Act 1979 (NSW) (LEC Act), which was held on 11 June 2026, and adjourned for continuation on 2 7 July and 11 August 2026 . I presided over the conciliation conference. At the conciliation conference, the parties reached an agreement based on amended plans and documents. The Council, as the consent authority, agreed to the amendment of the development application pursuant to s 38(1) of the Environmental Planning and Assessment Regulation 2021 (NSW) . The amended plans and documents contained in the Section 34 Bundle of Documents (the amended application) are: Amended Architectural Drawings prepared by Chenchow Little Architects Drawing No. Revision Drawing Title Date A-DA-000 02 Cover Page 16 June 2026 A-DA-100 03 Overall Ground Floor Plan – Existing 16 June 2026 A-DA-101 03 Overall Ground Floor Plan – Proposed 16 June 2026 A-DA-110 04 Ground Floor Pla n – Existing 16 June 2026 A-DA-111 04 Ground Floor Plan – Demolition 16 June 2026 A-DA-112 05 Ground Floor Plan – Proposed 16 June 2026 A-DA-200 04 South Elevation – Demolition 16 June 2026 A-DA-201 04 South Elevation – Proposed 16 June 2026 A-DA-202 03 East Elevation – Demolition 16 June 2026 A-DA-203 03 East Elevation – Proposed 16 June 2026 A-DA-300 02 Sections – Proposed 16 June 2026 A-DA-400 03 GFA Areas 16 June 2026 A-DA-500 02 3D View from Devonshire St Overall 16 June 2026 A-DA-501 02 3D View – South-East Corner 16 June 2026 A-DA-502 02 3D View – South-West 16 June 2026 A-DA-510 02 Schedule of Material & Finishes 16 June 2026 Bin Room Mechanical Ventilation Concept prepared by Integrated Group Services) 15 June 2026 Operational Waste Management Plan (Rev H) prepared by Elephants Foot Consulting 10 July 2026 Amended Clause 4.6 Request for Variation of FSR Development Standard prepared by Tony Moody 18 June 2026 The signed s 34 agreement was filed on 17 Ju ly 2026. The parties ’ agreement is for the grant of consent to the application, as amended, subject to conditions. The provision of a signed s 34 agreement meets the first condition to the exercise of power and obligation of a commissioner to dispose of the proceedings in accordance with the decision of the parties (this being the test applied by s 34(3) of the LEC Act): see McMillan v Taylor (2023) 111 NSWLR 634; [2023] NSWCA 183 ( McMillan ) at [51]. The signed s 34 agreement was supported by a Jurisdictional Statement that sets out the jurisdictional prerequisites to the exercise of the power to grant consent. Pursuant to s 4.15(1) of the EPA Act, I have considered the content of the Jurisdictional Statement, together with the documents referred to therein, the Class 1 Application and its attachments, and the documents referred to in C ondition 1 of Annexure A. I am also satisfied that the decision to grant development consent to the amended application , subject to conditions of consent, is one the Court could have made in the proper exercise of its functions, this being the second test applied by s 34(3) of the LEC Act: see McMillan at [4], [51]. I formed this state of satisfaction on the basis that: Landowner ’ s consent was provided by the owner at the time the development application was lodged. The site is zoned MU1 Mixed Use under the Sydney Local Environment Plan 2012 (SLEP) , and the use of the ground floor of the building for a caf é is consistent with the objectives of this zoning . The contravention of the Floor Space Ratio (FSR) development standard set out under c l 4.4(2) of the SLEP can be justified on the grounds articulated in the written request (Tony Moody, 18 June 2026 ) pursuant to cl 4.6 of the SLEP . The site has a maximum FSR of 2.5:1 , however the existing development already exceeds th is standard by approximately 6.94 %, or 13 4 m 2 , having an FSR of 2.67:1. The proposed development involves the conversion of part of the existing loading dock into caf é space, bring ing an increase in Gross Floor Area of 12 m 2 , result ing in a FSR of 2.69:1 and an overall exceedance of 14 6 m 2 or 7.56% . The proposed FSR is further described in drawing A-DA-400 “ GFA Areas . ” I am satisfied that the Applicant has demonstrated sufficient environmental planning grounds to justify the breach. I am also satisfied the Applicant has demonstrated that compliance with the standard is unreasonable and unnecessary as the proposal — which reflects the desired character of the area, provides additional amenity and streetscape activation and brings no adverse impacts — is consistent with the objectives of cl 4.4 of the SLEP , notwithstanding the non-compliance. Amended plans have addressed the heritage contentions raised by Council related to th e removal of external brickwork to create new or larger doors and windows . The building is a local heritage item ( I2264 ) and located in the Bourke Street Heritage Conservation Area. Pursuant to cl 5.10 (4) of the SLEP, I accept that Council have considered the impact of the proposal on the heritage significance of the building and the conservation area in which it is located , and that the development meets the objectives for heritage conservation set out in cl 5.10(1). In entering a s 34 agreement, I accept that Council has formed an opinion that the amended proposal exhibits Design Excellence pursuant to cl 6.21C of the SLEP. E xcavation to realise the proposal will be minor , involving the leveling of a section of the existing loading dock to marry in with the level of the proposed caf é . W hile the site is identified under cl 7.14(2) of the SLEP as Class 5 on the Acid Sulfate Soils Map, the proposed excavation will not extend below 5 m , nor result in any lowering of the existing water table. Although the site is in the Sydney Harbour Catchment, and thus the provisions Part 6.2 of State Environmental Planning Policy (Biodiversity and Conservation) 2021 apply , I accept that Council has considered and is satisfied of the matters set ou t in Pt 6.2 , Div 2. Pursuant to s 4.6 of State Environmental Planning Policy (Resilience and Hazards) 2021 , Council has considered , and I accept, that the site is unlikely to be contaminated . The development application was notified for 14 days between 25 November and 10 December 2025. No submissions were received. Having reached the state of satisfaction that the decision of the parties is one that the Court could have made in the exercise of its functions, under s 34(3)(a) of the LEC Act, I must dispos e of the proceedings in accordance with the parties ’ decision. The LEC Act s 34(3)(b) also requires that I set out the terms of the decision in writing. In making the orders to give effect to the agreement between the parties, I was not required to make, and have not made, any evaluative judgement on the matters that were originally in dispute between the parties, or any assessment of the merits of the development application against the discretionary matters that arise pursuant to an assessment under s 4.15 of the EPA Act. The Court notes: P ursuant to s 38(1) of the Environmental Planning and Assessment Regulation 2021 , the Council of the City of Sydney, as the relevant consent authority, has approve d the application for an amendment to Development Application No. D/2025/1158 on 17 July 2026, and that the Applicant can rely on the amended materials listed at [ 3 ]. T hat the Parties agreed that amendments to the D evelopment A pplication were minor for the purposes of s 8.15(3) of the Environmental Planning and Assessment Act 1979 (NSW) . The Court orders that: The appeal is upheld . The Applicant ’ s written request pursuant to cl 4.6 of the Sydney Local Environment al Plan 2012 seeking a variation to the development standard for floor space ratio is upheld. Development Application No. D/2025/1158 for alterations to the ground floor of the existing three-storey warehouse building, and approval for use of the ground - floor as a cafe at 268-274 Devonshire Street, Surry Hills (Lots 2, 3, 4 and 5 in DP 6533) is determined by the grant of consent subject to the conditions at A nnexure A . L Creagh Commissioner of the Court ********** Annexure A (323 KB, pdf) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 August 2026