Residents in Yalingup's Millbrook Estate are concerned about a potential amendment to a local planning scheme which could make way for a hotel development in the middle of a rural residential area.
Out for public consultation, the planning scheme allows a number of commercial developments to be built in the estate including a brewery, rural holiday resort, small bar and tavern.
Developer Kevin Merifield bought the heritage listed property 44 years ago which he subdivided 16 years ago into a rural residential area with 41 lots.
Mr Merifield and his wife Margaret kept 25 hectares of the property which had been approved for a number of commercial property developments.
In 2018, the City of Busselton Council approved a wedding reception centre at the site, however certain conditions placed on the approval meant the venue would have to shut by 7pm, making the venture nonviable.
For the past year, Mr Merifield has revisited the development with the City of Busselton and identified alternative land uses from the original subdivision plan.
"When we revisited it this time round with the city, they were not keen on the strata concept and asked us to look at alternatives that would reduce the additional use area from the whole property," he said.
"We reduced that heritage area right down to 10 hectares the city's planning staff wanted to put a limit on how much we could build which is 2,500 square metres, it is pretty restrictive.
"For example, if we wanted to build some accommodation like a guest house and some chalets the 2,500sqm would be gone straight away.
"If we wanted to build a micro brewery or a winery or a restaurant or a combination of uses the 2,500sqm would be taken up straight away.
"Any commercial development undertaken would be kept to appropriate scale to compliment the iconic heritage area."
However, residents living in Millbrook Estate have described Gunylgup Valley as an amplifier carrying noise from miles away and have started a petition objecting to the changes.
Gunyulgup Valley Action Group chairman Chris Avis said they did not believe it was appropriate to include additional commercial uses in a rural residential area.
The group believe it would be more appropriate to reduce the number of commercial uses on the designated lot and create new rural residential lots in the estate.
Mr Avis said the type of development the developer wanted to pursue would be more appropriate in an area that was zoned viticulture and tourism.
"If approved it will leave the developer with a small area to build a hotel, bar, the whole works," he said.
Gunyulgup Valley Action Group member Barry Lang said residents in the estate were opposed to a wedding reception centre at the site because of the noise it would create in the valley.
"He wanted wedding receptions on Friday, Saturday and Sunday nights all through the summer," he said.
"When people come here on holidays you can hear music all through the night from miles away, you could imagine a wedding reception smack-bang in the middle of the estate.
"It would have been a disaster for us who live here."
City of Busselton director of planning and development services Paul Needham said the plans guided the development of the estate for creation of rural residential lots and for a range of commercial developments on a larger lot.
"That larger lot contains the mill and the associated lake, and has been retained in the developer's ownership," he said.
"The changes now being proposed would allow for some additional rural-residential lots, but would significantly reduce the potential extent and scale of non-residential development allowed, in particular the potential development of significant numbers of chalets in close proximity to other rural residential lots."