In recent years the processes for pub renovation and development, particularly in New South Wales, have become conflated with consultants, besieged with bureaucracy, and laden with expensive and time-consuming traps for young gamers.
This a story about pub development. Advancement. Or more poignantly, it is about the barriers to this progress due to the devolution of the planning process in NSW, and how this has led to extensive delays, logistical hurdles, obfuscation and pointless burden on both the hospitality industry and the economy.
Unlike in Victoria and Queensland, which require only formality paperwork before pubs can get tradies to start swinging the tools, in NSW a complex system has developed employing consummate experts and political favour, and taking 6-12 months longer.
Beyond the bureaucracy, many local councils see pubs as problematic, threatening late-night revelry and the perceived threat of negative social impact. This has augured well with the policies trickling down from the state government level.
In recent years word began to get around that applying to council to do works could result in unwanted changes or conditions imposed on the business, most often a downward adjustment to operating hours. This threat has effectively killed operator appetite for risk.
“Every discussion with an operator starts with the hours, and how they could be affected by simply submitting a DA,” says Paul Kelly, head of Paul Kelly Design (PKD), which has begun building on its long- standing reputation in hospitality design to offer more services.
“We do a lot of brand and business development for a lot of our customers,” he explains.
A current project for PKD is the Commodore Hotel in McMahons Point, expected to reveal major works in August. PKD was first engaged on the Commodore by previous owner Graham Campion, who sold it in 2019 to John Azar’s Good Beer Co, for whom PKD did a DA. Azar went on to sell the Hotel mid-2023 to Glenn Piper and PKD is managing the project.
”As a business we run a number of projects in various stages of development,” says Kelly. “This can be from the initial idea, through to concept, the approval process, documentation, build then open.”
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SPANNER IN THE WORKS
Early 2020 the world turned upside down due to the onset of the coronavirus pandemic. For the first time in their history, pubs around the world simultaneously closed.
Whether cause or catalyst, since the ‘new normal’ returned there have been increasing hurdles to pub renovation and the approval process, particularly in terms of the internal systems of councils, and the third-party certification system they rely upon.
In some instances, commercial properties (such as pubs) are even being asked to supply reports on aspects that would previously have been considered council issues, now relegated to the property owner before any chance of approval.
The Certification System requires consultants, such as using a ‘private certifier’ for a DA or Complying Development Certificate (CDC).
But in 2018 structural cracks began appearing in the Opal Tower building in Olympic Park. Certifiers in Sydney saw the writing on the failing walls and ‘lost their mojo’, adopting extra measures to protect themselves in the wake of the sector-shaking legal fallout. This morphed what was previously a relatively straightforward process into an industry-shaping headache.
Turbulence in construction has had flow-on effects in the pub industry, largely due to the fact that most publicans buying a new asset will look to soon renovate, to capitalise on untapped potential.
“The advice I give is all about strategy,” says Kelly. “Owners need to understand the complete pathway, and multiple paths to approval.
“Where possible, a buyer should try to give themselves more time, such as through delayed settlements or ensuring works are agreed and supported, to begin on the design and planning phase as soon as contracts exchange. They need to put together a good team – legal, planning, design – to make it happen.”
The increasing demands by council, compounding the uncertainty of consultants, created an environment where the consultants are being swamped. Furthermore, the number required for a relatively basic DA has increased from two or three, to seven or eight.
The overloaded consultants – having their licence threatened if they don’t provide everything 100 per cent accurate and to code – struggle to get reports back in suitable timeframes, making what was a six- to eight-week process one that takes 12-14 weeks.
Over time the Certification process became increasingly interested in work underpinned by the code, beginning with the service consultants, before tradesmen building to code and the installer signing off on a code. Only then was the certifier appeased.
Under the weight of all the work, the consultants’ job increased four-fold. The requirements to be a certifier are extreme, and lacking the manpower to complete the additional scope, the backlog keeps building up.
The increased number of consultants, charging higher fees due to the work burden, all of whom need to be managed, greatly increases the costs to the hapless property owner. This step has grown to become around 15 per cent of the total project cost, atop the additional time taken.
Work at the Commodore stopped for four months, at the behest of council, when the construction program required a few extra things in the builder’s scope.
Council have reportedly also begun actively taking interest in findings and challenging the reports coming from consultants, asking questions that further delay the process and not letting anything go to the next stage.
“In the past council accepted the consults’ reports,” says Kelly.
“Now they are saying they don’t agree and need more information … spinning the wheels on making progress.
“Welcome to the world of the ‘pre-DA’.”
A DA BEFORE A DA
A pre-DA is a meeting with council prior to lodging the actual DA. It is intended to provide feedback on the application before you go ahead and lodge, and risk getting refused, which is not a good thing to have happen.
“It is much easier to modify an approval than to go back after a flat ‘no’,” says Kelly.
The problem with this introductory system is that the pre-DA requires the same kind of fully resolved design, with full support from the majority of the consultants to be used, all to prepare for something that is ultimately unknown.
Once ready, with all drawings completed, the project applies for the pre-DA (typically online, and for a fee). The council will then typically want everything by the book and stipulate changes required, meaning everything has to be redone and all the consultants’ reports updated before returning to try again.
“They have begun treating the pre-DA as a full DA. It can take months and months to get the required information to submit the updated application. Then they come out with conditions.”
One current PKD project, which has been going for more than two years, is now getting close to applying for its second pre-DA. These delays obviously amount to massive costs for the hotelier, and the actual DA has not yet even been prepared or lodged.
“Prior to COVID I would tell a client eight weeks to lodge a DA, now I would say three to six months.”
HAUNTED RENOVATIONS
Outside of the additional reporting, the approval process at councils began to slow when the coronavirus shutdowns took hold. While the building industry effectively did not shut down during COVID, council staff were working from home and approval timeframes blew out.
During this period a lot of pubs built new bars and trading areas, and reconfigured gaming rooms to meet the emerging distancing requirements.
But the pitfalls of the processes, compounding the frustrating disruption that was taking place throughout the wider economy, meant a lot of new work was done without the proper approval.
Council became active in watching pub sites, looking for construction activity and undertaking investigations to determine unlawful works. At least some of this likely stemmed from complaints by disgruntled neighbours.
Consequently, many of this work has since been detected, requiring the requisite certification and potentially drawing penalties.
Some of the activity has been revealed as a potential buyer seeks compliance prior to purchase. As Insurance is negated by unapproved works, many undocumented renovations had to be ‘cleaned up’ for the business to remain open.
“There are a lot of pitfalls in doing illegal work,” bodes Kelly.
“But a lot of publicans were forced into it, having purchased for a high price and lacking time to go through the system.”
Similarly, some reconfigured gaming rooms claim to be full smoking, but are not actually compliant. NSW health does come to premises and conduct inspections, with the same unwanted results.
MAKING PROGRESS
Once the DA is finally both submitted and approved the project moves onto certification for the Construction Certificate, which Kelly suggests usually takes at least three time the amount of time that it used to take. Beyond that comes the Occupation Certificate, again likely taking a significant amount of time due to all of the compliance.
The hurdles accumulate costs and delays for the venue owner, however there are some things even worse.
In 2023 an application to transfer gaming entitlements between two pubs led to a refusal and appeal that went all the way to the NSW Supreme Court, where the Independent Liquor & Gaming Authority (ILGA) lost, with Justice Sarah McNaughton ruling ILGA had overstepped its power in using the Liquor Act. The regulator responded by pausing all EGM applications.
But just two months later, an appeal saw the decision overturned and ILGA’s unfettered jurisdictional powers were returned.
This paved the way for what amounted to standard practise that a gaming-related application triggered conditions on the hotel’s licence, which has resulted in no applications being attempted.
Fast forward to 2025 and ILGA chairperson Caroline Lamb was addressing questions at a legal breakfast to discuss EGM regulations and the preparation of applications when she made reference to pubs and clubs ‘raping’ local communities.
This prompted a swift governmental smack-down, with Gaming and Racing Minister David Harris issuing a rare public rebuke of Lamb and posting multiple directives outlining what is expected of ILGA, specifically that it has multiple – equally important – mandates as a regulator.
ILGA was told to stop imposing arbitrary rules and meet its objectives as per the Liquor and Gaming Machine Acts: harm minimisation, responsible conduct, balanced development of the gaming industry, and an overall reduction in the number of poker machines in the state.
The Authority’s fear-inducing practices had effectively halted the government’s plan to reduce the number of machines and forfeiture of licences through the gaming machine entitlement transfer scheme.
It remains to be seen what will come of near future applications, but it is widely hoped that ILGA is back in the business of hospitality.
“No-one has done an application with ILGA in the last two years,” concurs Kelly, who believes it has had a broader detrimental effect on the industry.
“Instead of optimising the layout, the gaming stays exactly where it is, meaning operators are not getting the greatest efficiency out of spaces.
“The fear of conditions has changed the renovation strategy.”
