While councils are warning the changes neglect the role of community feedback, the government claims they are necessary to simplify planning decisions.
Locals are railing against the 150-apartment project, saying it doesn’t fit the area’s character.
Residents, heritage enthusiasts and Willoughby City Council are opposed to the $106 million complex.
The $138 million proposal would see an eight-storey complex on Grosvenor Street.
Rejected once in 2019, the developer is having another crack, this time via the state government.
If approved, the site will become home to 132 new properties.
The site is currently home to two popular restaurants and a health food store.
The firm behind the redevelopment previously designed the world’s tallest building.
Developers are able to upsize their buildings if they agree to put accommodation aside for those on average incomes.
Members voted 226 to 91 in support of the decision.
Concluding their legal battle with the NSW government, the council has set a precedent that state planning controls are not entirely unchallengeable.