A multi-million dollar upgrade of Newcastle Beach Hotel has been approved, but the application stirred debate around whether proposed restaurant, bar and function areas were "ancillary" uses.
The development application for the Parnell Place hotel operated by the Alloggio Group, includes a ground-floor day spa and cafe and first-floor bar and restaurant, as well as two penthouses at the rooftop level which would replace Rosa's Rooftop.
It received unanimous support from Newcastle councillors at the July 25 meeting.
Two dozen objections were lodged about the proposal, and Newcastle councillors said they were also contacted by residents with concerns about whether the additions were "ancillary" to the primary usage of accommodation, and not allowed in the R3 zone.
The hotel would have 42 rooms, while the restaurant, bar and function areas would cater for up to 550 people.
"I know that this is one of the major concerns for the residents, that the independent operation of the bar and restaurant area will in all likelihood operate as a pub regardless of the hotel accommodation being the dominant use," Labor councillor Carol Duncan said.
However council staff said the "issue around ancillary use is not live".
"Because the hotel definition is sufficient to accommodate the proposal in its entirety but for the spa, which is considered to be an ancillary component of the development, and based on the total FSR I believe comprises about one per cent of the floor area," council staff said.
"Our position is that the argument or legal precedent around ancillary uses is not at play in this matter.
"It's a permissible use in its entirety, but for the ancillary component of the spa, which we've conditioned and as you can see from the plans is very minor."
Greens councillor John Mackenzie said the council had approved other developments with a restaurant, function room and day spa included.
The development is subject to a raft of conditions, including reduced opening hours of the restaurant, that the spa is to stop operating if the dominant use ceases, and no more than 550 patrons being allowed in the licensed areas at one time.
The applicant has also agreed to set up a noise complaint register and action plan with neighbours.
