Car-park issue comes back to Sorrento Author: Mark Phillips Date: 19/09/2006 Publication: The Financial Review
Folkestone is in discussions to buy a parcel of land in the Victorian seaside town of Sorrento ripe for development into a supermarket after the owner gained approval for the contentious project.
The listed property development and investment company would not comment but is understood to be negotiating with Hammond Royce Corp, which last month won approval in the Victorian Civil and Administrative Tribunal for a mixed-use development in Ocean Beach Road that would increase the upmarket beach retreat's retail area by 20 per cent.
The VCAT approval waived normal car parking requirements, allowing the developers to provide just 15 basement spaces for staff rather than the estimated 60 customer spaces that would be needed during peak hours.
Local businesses fear the new supermarket - understood to be a Coles - could cannibalise existing retail trade.
They are also infuriated that they were levied earlier this decade to cover half the cost of a large council-owned car park next to the development site while the supermarket will not need to contribute any money.
The approval by VCAT is for a two-storey building and basement car park with a 1122 sq m supermarket at ground level and four office or retail tenancies on the first floor.
Sorrento now has two small supermarkets which each have a floor space of about 400 sq m and turnover of about $3.5 million a year.
The VCAT hearing was told that the new supermarket would generate $12.3 million in turnover in 2009.
VCAT president judge Stuart Morris and member Mary-Anne Taranto conceded it was possible the new supermarket would significantly affect at least one of the existing stores by drawing trade from them.
Justice Morris and Ms Taranto rejected the council's suggestion that about 75-80 parking spaces should be provided in the basement of the supermarket. They said multiple underground parking levels would be impracticable on a site of less than 1500 sq m, and would be inequitable as most existing retailers in Sorrento did not have to provide customer parking.
But this has infuriated the council and local traders who were required to pay 50 per cent of the construction cost of a 159-space car park next to the development site through a special charge in 2003.
"We have come to the conclusion that the proposal will bring about significant benefits to users of the Sorrento shopping centre," Justice Morris and Ms Taranto said.
"We acknowledge that there may be some impacts on at least one of the existing smaller supermarkets.
"But that outcome is a normal part of free market competition, in which the planning process cannot intervene."
Mornington Peninsula Shire mayor Brian Stahl said the VCAT decision was a disappointment as it had allowed a loophole for developers to avoid contributing to car parking costs in future.
"That's something we will be taking up with the minister and trying to get a review of that instance because it's a gross disadvantage to other traders who have contributed to car parking and then others can come in without making any contribution," he said.
Mr Stahl said the development was also out of keeping with Sorrento's local character.
KEY POINTS
*Retailers are upset the developer need not have to build a car park.
*Retailers paid half the cost of a car park next to the site in 2003.