The Inkerman D'LUX Development (formerly Inkerman Oasis Development) comprises 236 new apartments in Inkerman Street, St Kilda (Melbourne). Occupancy of the first apartments occurred in mid-2003. The development includes a novel water recycling scheme based on supply of treated greywater to toilets and a below-ground garden irrigation system. Stormwater from the site is also treated and recycled for these purposes. The key components of the water recycling scheme include a subsurface flow wetland for stormwater storage, a lint trap for greywater pretreatment, a membrane bioreactor for treatment of both stormwater and greywater and a UV disinfection system. The objective of the treatment train is to produce effluent classified as "Class A" according to the Victorian EPA Reclaimed Water Guidelines. A contracting company specialising in novel water management systems in urban developments provided the treatment system to the site developer. South East Water has provided financial support to the contractor and operates and maintains the system under a contract with the body corporate. The treatment system was commissioned in mid-2004 and underwent verification testing prior to supplying water for the intended uses. The key components of the water recycling system and outlines of the basic contractual arrangements are described, and details of the key issues, including protection of public health, are provided.