In December last year, Allenby Farms applied to the Queenstown Lakes District Council to undertake a six-lot subdivision and associated earthworks to the east of Rob Roy Lane.
In August, the council publicly notified the application because of "special circumstances".
The area of land was confirmed as part of the Mt Iron outstanding natural feature (ONF) by the Environment Court in 2019, despite the land being zoned suitable for residential development, and it was an important Wanaka landmark, the notification said.
Council spokesman Jack Barlow said the council was addressing the anomalous zoning.
The council’s planning and strategy committee had endorsed the concept of a variation to the proposed district plan to change the zoning of the land.
However, it had to be approved by the full council, notified and go through the processes.
Also, the council could not legally hold up the consent process to wait for a variation to be undertaken, he said.
Residents’ group spokesman Tony Marsh believed people in the Wanaka community were probably unaware of the proposed development.
The Upper Clutha Environmental Society has already made a submission on the application for subdivision.
"Far too much development has been consented to on Mt Iron and Little Mt Iron in the past and this application represents yet another inappropriate intrusion into the landscape in this vicinity," its submission said.
Submissions are open until Thursday.
