Independent commissioners say consent for the proposed $300 million Gibbston Valley Station should be granted, but they are concerned about the scale of the villas, the visibility of dwellings from the Kawarau River and the proposal to remove some vine plantings.
In a memorandum to the parties, commissioners David Collins, Leigh Overton and Andrew Henderson said while the 30 "barely visible" units next to the proposed 18-hole golf course could be anticipated to attract golfers, they were not persuaded the 62 proposed "winery villas" would be filled by people specifically wanting to stay in the vine growing area, "particularly bearing in mind the other consented accommodation in the Gibbston Valley".
One solution would be to delete 38 units to bring the scale of visitor accommodation into a supportable range and rearrange the commercial area and visitor accommodation to eliminate the need to remove existing vine plantings, the commissioners said.
"We consider it unacceptable that even buildings designed to blend into the landscape would be visible from the surface of the river," they said.
"In our view, it would be practical to screen the limited views of the community buildings.
But we consider the dwellings, even with these deleted, are quite high for this context, so we believe it is unlikely that relocation of these buildings away from river sightlines would be acceptable."
Station plan managing director Greg Hunt said he was pleased the commissioners recognised the comprehensive nature of the proposal in their interim decision.
A revised plan to Lakes Environmental would be submitted within the next few months.
"Economic viability is the concern of the developer and we didn't present any economic evidence [at the hearing] because we've been through an Overseas Investment Office application which tests economic viability.
"To say there are other options for visitor accommodation in the valley is questionable."
Queenstown kayaker Ken McIntyre submitted in opposition to the development, over its visual impact on the Kawarau River, and said he was pleased with the commissioners' memorandum.
Mr McIntyre said he had kayaked on the section of the river which bordered the proposed station since 1982 and it was "a blast from the past, a bit of wilderness that still exists".
The member and coach for Central Otago Whitewater said his submission was representative of the majority of the 50 to 60 members in the incorporated society.
"From my own personal viewpoint, [the memorandum] is good. It means they can't, at this stage, build those houses that would intrude into the riverscape."
The commissioners issued the memorandum to parties after considering the resort proposal in the application and during hearings last December.
The memorandum's purpose was to invite the developer to submit a revised plan that could form the basis of consent.
The concerns could be addressed by deleting parts of the development as a condition of consent, they stated.
Mr Overton said the memorandum was not the commissioners' final decision.