Hawkesbury Council failed to lodge an objection to a $213 million tourist development proposed for Kurrajong Hills, sparking outrage from local residents who fear the project will devastate the environment, overwhelm infrastructure, and disrupt their community.

Documents obtained by the Hawkesbury Post reveal the Council missed the May 30, 2024 deadline to submit its views to the NSW Planning Panel, on a massive tourist development set to reshape the region.

“This project is a disaster waiting to happen,” a local resident told the Hawkesbury Post. “We’re talking about pristine bushland being cleared and a community put at risk in the event of a bushfire.”

The proposed development, named "The Island’s Oasis," would transform the bushland site into a sprawling tourist destination with 311 permanent cabins, 120 lodge suites, camping and caravan sites, a large central clubhouse, six communal kitchens, and various recreational facilities. While the plans include upgrades to Hermitage Road and Bells Line of Road, local residents argue these changes are insufficient for the sheer scale of the project and again would see the felling of habitat.

The developer is Tony Mehri who owns Merc Capital Group. His son Bashir Merhi, through his Balma Projects Pty Ltd, is also trying to push through a new development just up the hill in Kurrajong. He wants to build a large, modern gambling venue in historic Kurrajong Heights village. 

The environmental value of the Kurrajong Hills site has been a central point of contention. Large tracts of uncleared land, home to endangered Cumberland Shale-Sandstone Ironbark and Turpentine forests, would be cleared to create an asset protection zone, while vital riparian areas would also be affected. The land is known for its biodiversity, including a well-documented koala colony that would lose critical habitat.

The resident - who wished to remain anonymous for now - said there was significant bushfire risks posed by the development, which borders Wollemi National Park and the site has only one narrow access road shared with an existing housing estate. “This is a death trap,” he said, recalling how the 2019 Gospers Mountain fire came within a kilometer of the site. “The developer’s suggestion of an alternative fire trail exit is completely unworkable.” The documents lodged with the Department of Planning also state the costings for the project are based on the use of lightweight prefabricated material where possible. 

Concerns about the developer’s intentions have further fueled public opposition. Tony Merhi of Merc Capital Group, who owns the land, has faced allegations that the project is less about tourism and more about securing approvals to increase the property’s resale value. Residents who spoke to the Hawkesbury Post pointed out that a previous attempt by Merhi to rezone the site for a 450-lot residential development was unanimously rejected by Council in 2013.

At the time, Council concluded that the land lacked the infrastructure, environmental capacity, and fire safety measures needed to support such a large-scale development. In its assessment of the earlier proposal, Council concluded that the land “has no appropriate physical characteristics or environmental capability” to support development and warned that it would fragment land with significant ecological and agricultural value. Despite the similarities between the two projects, Council this time failed to make any submission to the Planning Panel regarding the current proposal.

A GIPA request (Freedom of Information) sighted by the Hawkesbury Post sheds light on how the deadline to provide advice to the Department was missed. Council said that no formal consultation letter had been received, with communication limited to an automatic email notification. “...Council did not receive any cover letter, consultation letter or similar aside from the attached automatic email notification. Council has not yet made a submission in response to the consultation,” Council said. As a result, no advice was prepared or sent by the May 30, 2024 deadline.

The failure has left residents feeling betrayed. “The community deserves better,” the resident said. “This development would permanently scar our region, and Council didn’t even bother to voice our concerns.”

The developer has no track record of building or managing similar ventures, instead focusing on securing development approvals or rezoning before selling off projects. The costings for the project state that marketing, sales, promotional expenses, display unit costs, and any operational or ongoing maintenance expenses have not been accounted for. This omission raises questions about the developer's intentions. The available documents do not clarify what the developer plans to market or sell.

Concerned residents have questioned the financial viability of the proposal, noting that the estimated $213 million investment would likely generate less than $20 million annually based on current NSW tourism occupancy rates. “This doesn’t add up,” he said. “It looks like a classic case of securing a development application just to sell the land at a higher price.”

The project’s classification as a State Significant Development means the final decision rests with the NSW Independent Planning Commission (IPC), effectively bypassing the local Council. However, the Council still had an opportunity to submit feedback to the Department.

The developer is moving ahead with community consultation, scheduling a drop-in session at the Kurrajong Community Centre on Saturday, February 1 at the Kurrajong Community Centre, 30 McMahons Park Road, Kurrajong between 10am and 2 pm. 

Residents remain skeptical about whether their concerns will be genuinely addressed.

“This isn’t just about one project,” one resident said. “It’s about the future of the Hawkesbury. Do we allow short-sighted, profit-driven developments to destroy what makes this place unique, or do we stand up for our environment and our community?”

For more information about the project you can follow these links:

Community Facebook Page Against the Development

Planning Panel documents

Island Oasis Marketing Material

The yellow line shows the development site.