The 188-site caravan park, called Sunrise Park, is proposed as a permanent residency area off Nelson Bay Road, where the Driver's Luck Winery was previously located.

A development application was lodged with Port Stephens Council in December last year with many residents living nearby raising concerns about its impact on traffic, the rural aspect and the $1.23 million caravan site proposed by another developer just down the road.

Since the application was lodged the developer, Ray Family Holdings, has worked with the community to iron out a few of the issues.

With the construction of the site the community is set to get Binder Road sealed, as well as four hectares of landscaped parkland.

The proposal includes the upgrade and extension of reticulated water and the sewer as well.

The site itself will have a heated swimming pool, playground, bowling green - which doubles as a croquet court - two tennis courts and a community function centre.

According to the developer's spokesman, who presented during public access at Port Stephens Council on August 12, the site's amenities will be open to the public and hence benefit the local community.

They also argue the sealing of the road, upgrades to utilities and the addition of parkland will provide additional benefits to the community, while saving the Port Stephens Council money on major works. The developer believes this should be considered as reason to reduce the developer contributions from an estimated $1.2 million to $750,000.

It is estimated the low-cost housing option will contribute $5.8 million to the local economy.

Construction will generate 12 jobs plus a further 38 in operation.

The matter goes before PSC at the August 26 meeting.