A huge retirement village planned for a seaside suburb on Auckland's North Shore has overcome a major obstacle thanks to local residents withdrawing their opposition.

Community lobby group Devonport Peninsula Precincts Society strongly opposed Ryman Healthcare's plans to build a six-level development with 269 carparks on a 4.2ha site at Ngataringa Bay.

The development was set to include a 120-bed hospital, 195 independent living units, 78 apartments and an array of amenities including an indoor pool, theatre, library, sales office, salon, shops and a transformer substation.

Auckland Council has already granted consent for the development, however the society lodged an appeal with the Environment Court in February to challenge it.

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The group told the Herald in February that the appearance and scale of the project were at odds with the natural beauty of the site, which has a vista of the Waitemata Harbour and is beside a strip of regenerating native bush. It also expressed concern about the amount of traffic it could generate in the area.

However, society chairperson Iain Rea said that after a month of discussion, the two parties had finally come to an agreement, Radio New Zealand reported. The development was now waiting for approval from the Environment Court.

Rea said positive negotiations with developers were possible and it would save builders a lot of time if they discussed plans with locals first.