Two related development applications proposed to subdivide land bounded by Eagle Avenue, Kingfisher Avenue and Moira Parade into 33 lots, and build four apartment buildings were refused by the Minister last Wednesday due to concerns about the development's impact on the koala population.

Mr Sartor said an environmental assessment also identified a potential flood risk.

"This proposal would destroy core koala habitat and fragment a known habitat corridor," Mr Sartor said.

"The development application does not provide adequate measures to minimise the impact on this vulnerable species."

Mr Sartor said areas of the site are located below the 1-in-100-year flood level and there is currently no public road access to parts of the proposal.

The site is also subject to a revegetation order from the Land and Environment Court.

"In light of these factors, I had no choice but to refuse the proposal," Mr Sartor said.

"A key aim of the Iemma Government's State Plan is to promote a healthy environment.

"The refusal of this proposal ensures core habitat for the vulnerable koala population of Hawks Nest and Tea Gardens is conserved."

The Minister is the consent authority for the proposed development site under State Environmental Planning Policy No. 71 - Coastal Protection.

More than 80 public submissions were received during exhibition of the proposal, including a recommendation from Great Lakes Council to reject the proposal.

"I want to thank council and the public for their input," Mr Sartor said.

"This decision shows how the planning system in New South Wales operates to deliver the right outcome for the community and the environment."