Posted on September 18, 2017 by Sue Puckeridge and Katie Mortimer
Build it up – developing in airspace
Increasing density in urban areas is resulting in greater pressure for increased building heights. Inevitably, this will lead to greater pressure to capitalise upon the value of air space. A recent decision of the Land and Environment Court (‘Court‘) has considered the permissibility of a stratum subdivision of airspace above an approved development.
The Court found the stratum subdivision was permissible itself, however dismissed the appeal as no subsequent development would be permissible within the subdivided airspace under the current Auburn Local Environmental Plan 2010 (‘LEP‘).
What is the stratum subdivision of airspace?
A landowner owns the space above and below the surface of their land. Land can be subdivided both vertically and horizontally, and it is possible to vertically subdivide land to create an ‘air space’ lot that sits above a building.
To sell or transfer the air space above land, a landowner must create a stratum ‘air space’ lot. A right to develop within that air space lot will be dependent on and limited by the planning instruments that control development on that land, and the development consent applicable to that land.
The decision of the Land and Environment Court
In a recent decision of the Court, the Applicant, Sydney Project Group Pty Limited, sought development consent to stratum subdivide the airspace above an approved development (‘Stratum Subdivision‘). Although the subdivision was permissible, Cumberland Council (‘Council‘) refused to grant development consent to the Stratum Subdivision, and on appeal its key contention was that the proposal would create an ‘unacceptable level of uncertainty for planning’ on, in and around the site.
The Planning Uncertainty caused by the Stratum Subdivision
The Council contended that if a lot was created by the Stratum Subdivision this would lead to a high expectation of development on that lot. However, having regard to established planning principles, a subdivision should be capable of a permissible use and a Court has an obligation to consider the ultimate use of land when granting consent for subdivision.
Council argued that any development within the Stratum Subdivision would not be permissible, as any development would breach both the height control and maximum FSR allowed under the LEP.
The applicant conceded that any development within the Stratum Subdivision would be in breach of the current LEP. However, based on potential changes to the LEP that had been exhibited in the Draft Auburn and Lidcombe Town Centres Strategy (‘Strategy‘), which was yet to be finalised, development would be possible because of increases in the height limit of buildings in the area.
Commissioner Chilcott gave little weight to the Strategy, due to its draft status and because it didn’t overcome the maximum FSR applicable to the site under the LEP.
Therefore, even though the proposed Stratum Subdivision was permissible, because no subsequent development would be permissible within any lot it created, the subdivision would have no purpose. Consequently the Commissioner dismissed the appeal.
It is clear, however, that had the LEP permitted development in this airspace, the decision may well have been different. The decision therefore serves as a reminder of the potential development opportunities and value that may exist in unused airspace.
Read the Court’s full judgment here: Sydney Project Group Pty Ltd v Cumberland Council  NSWLEC 1500
This blog was prepared with the assistance of Katie Mortimer. Should you wish to discuss the case, please contact Sue Puckeridge, Partner on 8235 9702 or by email, at email@example.com