ASX-listed diversified property group Mirvac and construction group John Holland are tipped to win Sydney's next major over-station development project, the Waterloo Metro Quarter in the city's inner south.

Mirvac and joint-venture partner John Holland are understood to be ahead in the two-horse race as the preferred bidder for the tender that will yield over 70,000 square metres of new homes, offices and retail space, although a final announcement is yet to be made.