UPDATED 4.10pm: An application to turn Mills Reef winery's grounds into a 198-unit retirement village will be put before a Tauranga City Council hearings panel next week.

The Vines at Bethlehem Ltd are seeking resource consent to turn the grounds that have played host to Stars Under the Stars and The Winery Tours concerts into a retirement village and associated activities.

Mills Reef winery's grounds could be turned into a 198-unit retirement village. Photos: Supplied.

The site is also home to a well-known Tauranga function centre and restaurant.

The units will consist of 142 standalone and 56 duplex dwellings, and will be a mix of two and three bedroomed units with double and single garages. However, the overall make-up of the units may vary, depending on demand.

The application states that the majority of the existing Mills Reef building would be retained as part of the development. The building is intended to be used as an amenities building and would eventually include a gymnasium as well as administration facilities.

In the short term, the building will continue to operate and function as a winery venue, but the longer term plan is to remove the winery plant.

The proposal is to build in several stages, starting on the northern boundary of the site on additional land acquired recently by Mills Reef as a buffer against urban sprawl.

The owners have accepted that the prestigious winery and restaurant operation is being squeezed off its site by suburban pressures, and have started long-term planning to relocate to a fresh site in the Western Bay that enables much-needed business expansion, says Tim Preston, a director of Preston Group Ltd.

The popular winery and wedding venue will not be inhibited by construction activity for several years. The resource consent application has widespread support from the Bethlehem community, including most of the neighbouring landowners, says Tim.

The landmark art-deco winery building is to be kept as a centre-piece whilst incorporating the newest techniques in urban design, roading and streetscaping.

There will be extensive landscaping, with a 10-metre setback from Moffat Road, and the park-like feeling will be maintained.

'Bethlehem is a very desirable retirement location because it has the necessary community infrastructure in a village setting, while being close to Tauranga's central business district and the ocean,” says Tim.

It is expected to take up to a decade to complete, with the award-winning winery and restaurant/wedding venue staying put for the next five years or so before relocating to expanded facilities that reflect the winery's ongoing success in the industry.

'Regardless of where we move to, and when, we will ensure the relocation is seamless."

The existing entrance to the site, and the associated large open space, would be retained. The proposal would retain a number of trees along Moffat Road as well as the established trees which frame the existing driveway up to the Mills Reef building.

The application has been filed as a limited notification, meaning only directly affected neighbours and residents who have been informed by council in writing can make submissions on the application. There are three submissions opposing the proposal.

The application will go to a hearing because it exceeds the development density and scale. The majority of the site is zoned Rural Residential under the City Plan, while a small portion of the south-western corner is zoned Rural.

An overview of the plans.

The applicant says the site, and many of the existing site features including the Mills Reef complex, are locally iconic and are under threat of rural residential subdivision, which could pay little respect to the high-value amenity and brand that the Mills Reef site has established.

'The site can be developed as a residential village in a way that protects and enhances those key landscape values and features of the site and enable a larger number of people to enjoy them,” they explain.

It states the landscape character of the Moffat Road boundary will not be changed as a result of the proposal. They claim the recognisable magnolia trees and the framed iconic view of the Mills Reef building would be retained and, in some cases, enhanced by the development.

The entrance would remain largely unchanged and the views of the iconic Mills Reef building protected.

These key features would provide a touchstone in the landscape that relates to high amenity winery and restaurant history, for passers‐by and for the future residents of the village to enjoy.

The application will be heard before a Commissioner at the Tauranga City Council on Thursday, October 6.