AN Oakleigh historical group has welcomed a compromise for the Oakleigh Motel redevelopment but still has

concerns about a retaining a heritage-listed sign.

Last Tuesday, Monash Council granted a permit for the partial demolition and redevelopment of the motel into 34 town houses.

The design retains much of the original buildings and is significantly different from a 2008 proposal to turn the motel into 54 town houses.

While Oakleigh Developments has agreed to keep the lower 'Oakleigh Motel' sign, it has applied to Heritage Victoria to remove the sign above, which is listed on the Victorian Heritage Register for its cultural, historical and architectural significance.

Oakleigh and District Historical Society president Felicity Smith said the design was much better than the original proposal but the group was still concerned about the possible removal of the top sign.

"They've obviously gone back and looked at what VCAT have said and have really tried to be in keeping with VCAT's decision.

"It's far more respectful of the heritage value than the original proposition.

"On the whole, it gets a lot of ticks but my main concern is about the sign and if that can be retained.

"It's part of the inclusion for the state heritage register. To take it away would be like removing the rope from the Skipping Girl sign.

"It's part and parcel of why it's so iconic and I would be amazed if Heritage Victoria allowed them to remove it."

Mrs Smith said the society had made a submission to Heritage Victoria against the removal of the top sign.

A Heritage Victoria spokeswoman said the developer had sought a permit but had submitted an incomplete application and had been asked for further information. She said no approval had been given for the works yet.

Heritage Victoria issued a heritage permit for the site - which is no longer applicable - requiring the motel signage to be retained.

The Journal could not contact Oakleigh Developments.