The NSW government is building a new $250 million Sydney Fish Market and replacing the old building in Pyrmont with a new mixed use residential development.
The new 35,000 sq m market – double the size of the current property – will be built on an adjacent site to the market, which is leased to building materials manufacturer Hanson.
Hanson's lease ends at the end of the year but the NSW transformation arm UrbanGrowth, which is undertaking the project as part of its Bays Precinct project, said it would extend the lease by another 12 months until construction begins around 2018.
The new market will have 15,500 sq m of seafood retail space – compared with the current 6582 sq m – and outdoor dining for 3000 patrons as well as a possible rooftop bar.
Moving the site was necessary to create a new master plan for the tourist magnet – 20 per cent of the three million visitors to the market are tourists – according to a report by Deloitte Access Economics.
"The original market was a wholesale market with a couple of retail sites, and it was never master-planned when it was set up in the 1970s," the market's general manager Bryan Skepper said. "Since then the number of visitations have increased."
While Wentworth Park – which includes Sydney's biggest greyhound racing track opposite the new site – would not be affected, restoring public access between the park and the new market would be considered in the development.
The government will supplement the cost of the project with the redevelopment at the old site, which in the past year has attracted major developers such as Mirvac, Lendlease, John Holland and Toga.
Redevelopment plans were slowed due to resistance from several market shareholders, but those issues have resolved, Mr Skepper said.
While height of the buildings or the number of apartments have not been set, it is understood Mirvac still considered the project "attractive". A spokesperson for Lendlease said it would continue to engage with the government on opportunities in the area.
"The government needs new apartment sales to fund the new fish market ... towers of 20 to 30 storeys should generate enough income," Urban Taskforce's Chris Johnson said.
"There is now a topology of higher towers in the Pyrmont peninsula. In my mind the peninsula is able to take more towers."
But a redevelopment at the old site should "ensure the character and amenity of the local area is protected and enhanced", a City of Sydney council spokeswoman said.
"The number of residents needs to be supported by adequate infrastructure, including schools, and it has to be delivered before people move in and not after," she said.