Plans for the $5 million four-storey development, with three levels of basement car parking, is on public exhibition though currently regulations allow only three-storey buildings in the area.

"The proposal will provide social benefits including increased provision and diversity of accessible housing allowing some occupants to 'age in place' close to a range of local services and public transport," stated the application, prepared for Kendrodev Pty Ltd.

"The balconied outdoor seating area is designed to be reminiscent of 'Grand Hotel Verandas' and would provide a 'Byron Bay-like' evening dining and street life experience."

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Currently the site is occupied by a real estate office, kebab shop and a first-floor restaurant, and is opposite the Kiama Leagues Club.

If approved, the development would consist of 10 apartments (two- and three-bedroom abodes); three retail spaces, a restaurant, a cafe with outdoor seating facing Rosebank Lane, plus three levels of underground car parking - including spaces for bicycles.

The applicant argued allowing a taller "landmark" building would provide a "strong visual presence and focal point" to Kiama's town centre.

"These types of uses complement each other so that the building will function as a business and residential 'hub', satisfying a range of concurrent user preferences," stated the application.

"It has significant potential to provide high quality apartment living and employment creating business activities that will synergistically 'activate' an important landmark site in close proximity to a range of services and amenities."

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The application stated council officers had previously suggested to negotiate with the owner of an adjoining site at 116 Terralong Street with a recommendation to amalgamate both sites, but that idea was rejected by the adjoining owner.

"It is considered that variations to Kiama LEP (local environment plan) development standards relating to maximum permitted building height ... are justified in the context of seeking to achieve an outstanding urban design solution for this prominent landmark corner site," it stated.

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