Glebe Island firms as ‘Plan B’ for housing boost after collapse of ‘mini-city’

Transforming Sydney Harbour’s last working port on Glebe Island into thousands of high-density apartments is shaping up as a key plank of Premier Chris Minns’ plans to increase housing after the collapse of his $5 billion deal to transform Rosehill Gardens racecourse into a “mini-city”.

In a move expected to spark major backlash, the NSW government is increasingly likely to announce the transformation of Glebe Island – part of The Bays precinct in Sydney’s inner west – into housing as a key fallback option, according to senior Labor sources.

Despite opposition from industry, Glebe Island is firming as part of the Minns government’s “Plan B” for a major housing boost.Credit: Brook Mitchell

This was corroborated by a senior ports source who said discussions over the future of the working port had been ongoing for months, with operations likely to be shifted to Port Kembla.

Situated in the shadows of the Anzac Bridge, Glebe Island has been operating as a commercial port for more than 100 years, receiving large amounts of the state’s cement, sugar and gypsum. But sitting on prime land close to the CBD, the precinct has long been touted for conversion into housing.

One of several stations along the Metro West line, Bays West is being built between Glebe Island and White Bay Power Station. Scheduled to open in 2032, the station has been earmarked for significant housing development as one of eight metro or heavy-rail sites designated as “accelerated precincts” to build 60,000 new homes over 15 years.

The Bays masterplan, which will provide the framework for rezoning the precinct surrounding the metro station, is expected within weeks.

The Herald revealed in July last year that former Treasury secretary Michael Schur had been tapped to lead a secret review into whether the working ports at Glebe Island should make way for high-density housing.

Schur assessed scenarios including moving the ports, retaining the entire operation or building a hybrid model, involving both a scaled-back port and housing. The marinas at Rozelle Bay were part of the review. Passenger cruise operations at White Bay were excluded, however, and will be kept.

The Labor source said while the Schur review had not been rubber-stamped by cabinet, the decision to build high-density apartments on Glebe Island was all but assured. The Herald understands that the government has not been swayed by arguments from the port industry that shifting operations to Port Kembla would create significant cost implications.

The move would frustrate industry, with Cement Australia one peak body that has argued the supply chain disruption of moving operations to Newcastle and Port Kembla would cost the construction sector $50 billion each year.

The Ports Authority, the state-owned corporation which manages the operational needs of commercial shipping in NSW, had become resigned to the loss of Glebe Island’s operations, the source said.

There remained uncertainty about whether the Glebe Island proposal would shift the entire port operation to Port Kembla, or leave part functioning in the harbour. The hybrid model was explored by Schur as part of his review, but opposed by the Ports Authority.

A spokeswoman for Premier Chris Minns said: “No decision has been made. It’s pure speculation.”

Senior government advisers have stressed privately that “Plan B”, as coined by the premier, would not involve a like-for-like replacement for the 25,000 homes earmarked to be built on the Rosehill site.

Instead, uplift would entail a number of plans, particularly given development sources estimating that the Bays Precinct, incorporating Glebe Island, would yield around 10,000 homes.

The new map of Metro West – estimated completion date 2032 – including the unconfirmed additional station in Rosehill.

A spokeswoman for the authority did not respond to questions from the Herald, only saying: “The NSW government has been reviewing the future of the Bays Port precinct which has involved consultation with the Port Authority.”

Planning Minister Paul Scully declined to rule out closing the Glebe Island port when asked by the Coalition during question time on Wednesday, later noting that “building materials come into a lot of places in NSW, including the port of Port Kembla”.

“It is no secret that there will be a new metro station in The Bays precinct by 2030. It is also no secret that that area is one of the transport-oriented development accelerated precincts,” he said.

As he fronted the media after Australian Turf Club members narrowly voted against the proposal to sell Rosehill Racecourse for $5 billion on Tuesday, Minns said he would not be “disheartened” by the failure, but was already looking for “new initiatives to have housing closer to Sydney’s CBD”.

“If that ruffles a few feathers in the process, well, that’s exactly what great cities around the world desperately need,” he said.

In late April, the Defence Department intervened in the debate over Glebe Island, saying the port remained an asset for the Royal Australian Navy to berth vessels when the primary facilities on Garden Island were at capacity.

Business Sydney Executive Director Paul Nicolaou, a member of the Working Port Coalition, said there were several reasons to retain the Glebe Island port, including as a strategic location for the delivery of construction materials needed for Sydney’s housing supply.

“Its role in ensuring efficient, low-emission freight movement and supporting economic activity makes it a critical piece of infrastructure that serves Greater Sydney now and into the future,” he said.

Start the day with a summary of the day’s most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.