The Illawarra Hotel’s $7m makeover hits the courts as architects warn of ‘default’ approvals path
Architects say rising red tape and staff shortages are pushing more developments into court.
Architects say the Land and Environment Court is increasingly becoming the default route for development approvals across New South Wales, as councils struggle with complex regulations and shrinking planning teams. The trend has come into focus in Wollongong, where the owners of The Illawarra Hotel are appealing a council decision to block their proposal to revitalise the 1930s pub.
Reviving a landmark
The row between the hotel’s owners and Wollongong City Council has already made headlines. The council refused a proposal to convert the upper levels of the art-deco pub into a ballroom and restaurant, citing structural concerns.
The owners Ryan and Nikki Aitchison have appealed the decision in the Land and Environment Court, arguing their plan was designed to preserve the building’s heritage while giving it new life.
The couple bought The Illawarra Hotel in 2019, restoring the ground floor and adding heritage displays that celebrate the venue’s history. The next stage, reopening the upper levels, was costed at about $6–7 million, but the process has stalled.
The Aitchisons say they have already spent hundreds of thousands of dollars on consultants, reports and design work. The dispute, they say, has delayed plans to employ up to 50 staff and risks discouraging other small operators from investing in the city centre.
“There’s a sea of ‘for lease’ signs in the CBD,” he said. “Many of those buildings need a DA to be reactivated, and people just don’t want to go through it.”
A wider trend
Architect Mark Jones, executive director of Edmiston Jones Architects in Wollongong, said the case reflects a pattern playing out across the state.
“It’s really regrettably becoming the default approval process,” Jones said.
“In my 45 years’ experience, it’s only been in recent years that we’ve had a number of cases that have needed to go to the Land and Environment Court.”
According to the Land and Environment Court’s listings, 419 cases are scheduled over the next three weeks, seven involving Wollongong City Council.
Jones said the shift stems from growing regulatory complexity and limited council capacity.
“There’s an imperfect storm of increasing complexity and a reduced workforce,” he said. “Councils are having trouble getting the expertise and continuity they need, so things take longer and the court becomes the fallback.”
He said better communication early in the planning process could prevent many disputes from reaching that point.
For Aitchison, the need to fight the case in the Land and Environment Court is necessary but regrettable.
“All the money that we now need to unnecessarily spend on taking our city to court … is now going to be taken out of the money that we would be spending making this building something that Wollongong could celebrate,” he said.
Heritage with purpose
On heritage design, Jones said good outcomes rely on balance and preserving what matters while allowing change that keeps a building in use.
“The principle in respecting heritage is that new work doesn’t mimic it but complements it and is of its time,” Mr Jones said. “You keep the high-order heritage items - in this case, the façade, and make sure whatever is done is reversible.”
He said preserving a building’s use is often what keeps it standing.
“If the use is not preserved, the building will deteriorate and we lose the heritage because nobody maintains it,” he said.
Cost and consequence
The Aitchisons say the drawn-out process has come at a cost, both financially and emotionally.
“Every dollar we spend fighting council is a dollar we can’t spend improving the pub,” Aitchison said.
“We’re not developers. “We just wanted to bring this building back to life.”
Jones said councils could make greater use of conditional or “qualified” approvals, which allow projects to progress while specific technical matters are addressed.
“When council is confident that most issues are resolved, they can approve subject to a condition,” he said.
“That gives owners the confidence to proceed without the expense of going to court.”
The Aitchisons say they remain committed to restoring the building and hope the process sparks a broader discussion about how heritage, planning and development can work together across the state.
In a statement, Wollongong City Council said it supported growth and renewal but had a duty to assess heritage impacts.
“Wollongong City Council is committed to supporting existing businesses in our city to thrive, and understand growth and change is required for this to happen. However, as a consent authority, part of our role in assessing a Development Application involving a heritage building is to consider how proposed changes will impact on the values of the building.
“We know that the process of working through a Development Application can be complex. Our priority in the assessment of this Development Application has been to strike a balance between the renovation of the building, and maintaining the legacy of its heritage form and character. We understand that it’s important for the city to have a mix of the old and new, and that distinctive buildings and venues contribute to the city’s identity.
“We work within the NSW Government’s planning legislation as well as Wollongong’s own Local Environmental Plan and Development Control Plan when considering any Development Application. No one individual is responsible for the assessment of a Development Application, and each of our in-house subject matter experts contribute their knowledge into the assessment process. In addition, the assessment is peer reviewed before a determination is issued.
“Through the assessment process, Council supported a range of significant changes to the building that would enable operational improvements for the business. Council also had many conversations with the team from The Illawarra Hotel, where we asked for additional detailed information about aspects of the proposal to inform our assessments. It is the responsibility of the proponent to demonstrate that issues can be addressed.
“Council has determined the Development Application now and that decision will stand regardless of the newly launched petition. While the application was not approved, the determination provided advice about review and appeal pathways to enable the refurbishment of The Illawarra Hotel to be further considered.”
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