East Melbourne residents set to take Magnolia Court redevelopment fight to the state’s planning umpire

East Melbourne residents set to take Magnolia Court redevelopment fight to the state’s planning umpire
Brendan Rees

East Melbourne residents have vowed to launch an appeal against a City of Melbourne decision that would see a historic guesthouse redeveloped into a residential hotel, saying it would “seriously impact” the area.

Developer Primeland will breathe new life into the three-storey Magnolia Court guesthouse at 95-101 Powlett St under a $4.5 million proposal, which would include a new restaurant and see the number of guest rooms increased from 26 to 37.

City of Melbourne councillors unanimously approved the development at their April 12 Future Melbourne Committee despite receiving 95 objections, with residents expressing concerns the new venue would create noise, increase traffic, and, overall, would not be appropriate for the area.   

Magnolia Court is currently vacant after its previous owner, an East Melbourne resident, put the property up for sale in 2020 after it had become rundown, and operating as a “low average daily rate hotel.”

The guesthouse changed hands after Primeland Group and Singaporean fund Baksh Capital reportedly paid $9 million for the site with the intention of renovating and refurbishing the building, which was originally built in 1861.

Among those to address the packed council meeting at the Treacy Centre in Parkville was Ian Mitchell, president of the East Melbourne Group, who said the development would have a “massive impact” to the residential area, which he described as having the “finest heritage streetscapes in Melbourne.”

“We’re not against liquor licences on the periphery of East Melbourne such as Wellington Parade, however, it’s totally inappropriate in the middle of the residential area,” he said.

“This will be a watering hole for patrons en route to and from the MCG and other sporting precincts.”

“This also sets a terrible precedent for other potential cafes and premises to morph into bars.”


If the matter goes to VCAT (Victorian Civil and Administrative Tribunal), as it surely will, we propose to call expert evidence to support what we say.


“Please do not reverse your position and ruin our suburb for a 37-room hotel with a 128-seat restaurant, and staff parking for only four cars and in a noisy stack-up; it’s totally inadequate,” he pleaded with councillors – with his speech, along with other residents invited to speak, drawing applause from the gallery.

The council resolved to add conditions to the application, including that the venue be limited to 88 patrons with a maximum of 22 people in the ground floor outdoor area and four patrons on the first-floor outdoor terrace.

Patrons would also need to be notified of the unavailability and restrictions of on-street car parking within the area.

The restaurant’s indoor hours of operation would also be reduced from 11.30pm to 11 pm from Monday to Sunday, with the outdoor ground and second storey terrace operating from 8am to 8pm – with no live music.

Luke Pirrie, who spoke on behalf of Primeland at the meeting, alleviated any concerns the outdoor area would become a “beer garden”, saying it would be “nothing like” that.

“This will be fine dining. It will be majority inside for the restaurant guests and if they’ve got friends, family and hopefully residents who want to drop in and have a coffee,” he said.

“It’s something that we’re really proud of. It’s something that we hope the guests who come here not just from East Melbourne, but from all around the city can have a really unique experience.”

However, the East Melbourne Group’s planning convenor Greg Bisinella said the application was “problematic” and required “considerable changes to ensure a more sympathetic and respectful development is achieved.”

He told the meeting the former Magnolia Court “managed to coexist with the residential properties that adjoined and catered exclusively for a small number of guests only.”

“What we are advised is that this application is an over-extension of that use, and in the almost 70 years of the existence of the East Melbourne Group we have never seen an application for such an expansive restaurant and bar offering in a residential street of East Melbourne. We trust that you agree and reject the recommendation before you,” he told councillors.

Deputy Lord Mayor and planning chair Cr Nicholas Reece acknowledged the “significant and extensive preserved heritage precincts” within East Melbourne and assured the application had been assessed on its merits.

“I do understand the need to try and protect the atmosphere, the community and the environment,” he said.

“This is an application which I know has been very intensely scrutinised by councillors, including a number of us who have been down and walked the site as well just to understand clearly what is being proposed here.”

But he added, “our planning office advice is that a residential hotel is an appropriate use in the East Melbourne neighbourhood residential zone,” adding there would be no inappropriate demolition of the heritage fabric of the building.

“While we’re not considering a liquor licence tonight, we are very much considering the infrastructure, which may in future become part of a restaurant where alcohol may be served. And so, it’s important that we’re getting the settings I guess right from the very start.”

The council’s heritage chair Cr Rohan Leppert believed the application was “absolutely fair and reasonable” and consistent with council’s planning policies and controls – particularly by greatly reducing the number of patrons.

“It’s going to be a very different sort of hotel and restaurant with a different sort of clientele that’s been there in the past and so I wish all residents and the applicant well.” •

Like us on Facebook