Kiama Council and property developer Level 33 are scheduled to head to court in December after the formal mediation process in regards to Level 33’s Akuna Street development application was terminated.

The Akuna Street site was sold to Level 33 in late 2022 for $28 million. Due to the value and scope of the development application (DA) for the site, the assessment and final decision regarding the proposal was made by the Southern Regional Planning Panel.

The panel were not convinced that the proposal submitted by Level 33 satisfied the objectives of the site-specific controls for the site.

Level 33 initiated legal proceedings in the NSW Land and Environment Court in January and a Section 34 mediation conference held on 6 August at which the parties could not reach a mediated outcome, and was therefore terminated. A hearing has been scheduled for 10-12 December 2025.

Kiama Council’s Director of Strategies and Communities, Ed Paterson, said Council is continuing to work in the background on trying to sort out an agreement with Level 33 to avoid further court proceedings.

“Thankfully the courts agreed at the request of both parties to enable us to continue ‘without prejudice conversations’ so that if in the meantime we can come to a mediated agreement, we can go back into mediation formally and avoid the December hearing and additional expenses,” he said.

“A silver lining to the fact the courts are so delayed at the moment is that it does give us a few extra months to keep trying to iron out the issues.”

Paterson said the DA’s non-compliance with the Development Control Plan was the main sticking point.

“It's the biggest development site in central Kiama and whatever is built here will set the tone for the rest of the town, so we need to ensure it adheres to the principles Council has endorsed around view-sharing and not being an overly bulky building, both on Akuna Street and also Shoalhaven Street,” he explained.

“It's going to have quite a presence. As you go past Tory’s (Kiama Hotel) and you look up Shoalhaven Street, it's going to be a decent building.

“Some of the issues that arose throughout the assessment process have been taken away, things like laneways and how we're going to deal with the heritage building, but there’s still, really simply, a bulk and scale issue.”

The best-case scenario is for the dispute to be resolved before December’s court hearing.

The worst-case scenario is that the case will go to the hearing and a Land and Environment Court Commissioner will decide on the outcome.

Local residents are keen to see the Level 33 development get underway because it will mean the removal of one of Kiama’s ugliest eyesores.

The dilapidated area of the old Kiama Independent newspaper headquarters has been decimated by vandals and squatters with abandoned cars, smashed glass and graffiti throughout the site.

Complaints about vandalism, rubbish, water leaks, or the site’s condition should be directed to the property owners.

A Council spokesperson said they have raised its concerns with the owners following numerous community complaints.

Level 33 has not responded to requests for comment from The Bugle.

On the other side of Akuna Street, PSEC Project Services has withdrawn its application after Council advised the developer that amendments were required in order to achieve compliance with Development Control Plan objectives.

Council encourages applicants to withdraw DAs when redesign amendments are required to ensure DA timeframes do no blow out.

The development on the southern side of Akuna St is for 35 apartments with four commercial premises on the ground floor.