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Understanding existing use rights in NSW

In my post on zoning, I explained how zoning in NSW can restrict the type of development that is allowed on a parcel of land.

Zoning is a relatively recent phenomenon, having come into play in NSW mostly around the middle of the 20th century under the former Local Government Act and having existed since then under the Environmental Planning and Assessment Act 1979.

What happens when a property is allocated a new zone that is different to the use that has been operating on the property?

Let's consider an example below:

John operates a shop at 12 Smith Street Old Town. The shop has operated at the site for the last forty years, over this time, the site has always had an commercial zoning where shops are allowed.

Council and the NSW Government adopted a new LEP in 2018 that rezoned the site to residential. John wishes to move the shop to a new site, although still owns the property and wants to know what his options are for a redevelopment at the site.

Ordinarily, a development of the site must comply with the uses that are permitted in the zone. Let's consider how existing use rights may operate in this case.

The legislation for existing use rights is set out in Section 4.11 of the Environmental Planning and Assessment Act 1979. This defines an existing use as follows:

(a)  the use of a building, work or land for a lawful purpose immediately before the coming into force of an environmental planning instrument which would, but for this Division, have the effect of prohibiting that use, and

(b)  the use of a building, work or land:(i)  for which development consent was granted before the commencement of a provision of an environmental planning instrument having the effect of prohibiting the use, and(ii)  that has been carried out, within one year after the date on which that provision commenced, in accordance with the terms of the consent and to such an extent as to ensure (apart from that provision) that the development consent would not lapse.

John meets the requirements for existing use rights above, as his shop has operated under an approval issued by the local Council. It should be noted that clause 4.66(3) of the Act provides that an existing use is presumed to abandoned if it ceases to be used for a continuous period of 12 months - existing use rights would no longer apply in these cases.

Part 5 of the regulations provide further information with respect to existing use rights as follows:

(1)  An existing use may, subject to this Division:

(a)  be enlarged, expanded or intensified, or

(b)  be altered or extended, or

(c)  be rebuilt, or

(d)  be changed to another use, but only if that other use is a use that may be carried out with or without development consent under the Act, or

(e)  if it is a commercial use—be changed to another commercial use (including a commercial use that would otherwise be prohibited under the Act), or

(f)  if it is a light industrial use—be changed to another light industrial use or a commercial use (including a light industrial use or commercial use that would otherwise be prohibited under the Act).

(2)  However, an existing use must not be changed under subclause (1) (e) or (f) unless that change:

(a)  involves only alterations or additions that are minor in nature, and

(b)  does not involve an increase of more than 10% in the floor space of the premises associated with the existing use, and

(c)  does not involve the rebuilding of the premises associated with the existing use, and

(d)  does not involve a significant intensification of that existing use.

As can be seen above, if John didn't wish to pursue a residential development on his site, there are a number of options that he could pursue. These include rebuilding another shop on the site, enlarging the existing shop, alternations/additions to the existing shop or even changing to another commercial use (office, retail or business related).

For any further questions on existing use rights, feel free to get in contact.

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