The co-owner of a newly rebuilt Sydney landmark has declared his relaunched fine dining room “dead in the water” after complaints from a handful of residents saw an application to serve customers at night rejected by Northern Beaches Council.

Prominent restaurateur Ben May wanted to extend trading hours at The Joey, also known as the Barrenjoey Boatshed, from the current 7am to 4pm to 11pm seven nights a week but was knocked back, triggering a likely challenge in the Land and Environment Court.

The old boat shed, a Palm Beach landmark since 1947 and a key filming location for the long-running television drama Home and Away, underwent a $7 million rebuild “from the water up” before reopening in February.

The application for extended hours was rejected even though a nine-hole golf course separates The Joey from its nearest residential neighbours.

The council received 132 submissions supporting the proposal for night trading and seven submissions against.

“We’re 600 metres from the nearest house,” May said. “We’re one of the most remote restaurants in Sydney. I’m not sure how we impact them.”

He also questioned why The Joey could not open at night when nearby businesses do. “The golf club does. Dunes restaurant can trade at night, even Casa by The Boathouse is open for dinner, and it is right next to homes,” May said.

Notes from the Northern Beaches Council show a panel assembled to deliberate on the application was concerned about the impact of the extra operating hours on nearby residents.

“The panel is of the view that the increase in operating hours and the inevitable increase in functions, noise, traffic and other amenity issues resulting from these extended hours does not meet the requirement to be of minimal environmental impact,” the council notes said of the decision.

The three-person panel comprised the council’s two development assessment managers and its strategic and place planning manager.

The list of concerns from the complainants ranged from an impact on parking to not offering a benefit to the public when it is booked for functions.

“There were over a hundred submissions of support [but] sadly council have listened to a handful of objectors,” May said.

“Parking isn’t an issue here at night. There are hundreds of spots, and I’m not sure where the concern about functions comes from. It’s a restaurant, and I’m not sure we’ll be benefiting the public if we’re closed.”

The Joey opened in February with French chef Guillaume Dubois overseeing a kitchen serving lobster frites and grilled snapper. The upmarket dining room has a designated space in the $7 million rebuild of the boatshed.

The lease on the site was taken over from the Boathouse group stable last August by seasoned hospitality operator Rob Domjen and May, who are also undertaking a $5 million renovation of the Reef Restaurant and Cove Cafe in Terrigal on the NSW Central Coast.

May warned the council decision would cost jobs. “The Joey is somewhere with world-class views, for locals to enjoy and take people from overseas. It’s a blow for employment, for young people up here.

“After next week we cannot trade after 4pm. People won’t even be able to watch the sunset.”

The Joey will revert to the casual daytime side of the business until October, when its owners will be able to open just two nights a week under an existing provision during daylight savings.

May has vowed to take the decision to the Land and Environment Court over the coming months.