The future of the state Coalition government's much-vaunted agency charged with delivering urban housing projects through inner Sydney is up in the air following an internal review that recommended the agency be split in two.
UrbanGrowth NSW was created as a replacement for the government developer Landcom in 2012, in what then planning minister Brad Hazzard described as the biggest reform to the sector in almost 40 years.
"The approach of targeted government intervention in the property market is already a feature in every other state and the NSW industry has been crying out for such an organisation," Mr Hazzard said at the time.
The idea was to turn Landcom, which had primarily focused on releasing land for development on the fringes of the city, into a new agency that could help facilitate property projects across the whole city.
But Fairfax Media can report that a review conducted late last year by the Department of Premier and Cabinet recommended splitting the functions of UrbanGrowth in two.
One section would re-focus on Landcom's old role of land release and remain under the control of the Planning Minister.
The other section, which would remain as UrbanGrowth, would be under the control of another minister - such as Minister for Infrastructure Andrew Constance or Premier Gladys Berejiklian.
Sources said on Wednesday that it was unlikely that UrbanGrowth would be folded into another department, despite a push by Transport for control of the organisation.
"UrbanGrowth has got the city and Landcom has got the west," was how one source described the likely split.
It is understood that one of the motivations behind the review was a perception in government that UrbanGrowth was struggling to meet its mandate of delivering major and good quality housing projects across the city.
In part that was because the agency has clashed with other departments, particularly Transport, over development schemes such as the proposed Central to Eveleigh scheme, mooted development along Parramatta Road and in the Bays Precinct around Rozelle.
Another view, however, is that government impatience failed to take into account the long development times of major schemes such as the Bays.
UrbanGrowth now has no responsibility for the redevelopment of Central Station, which is being managed by Transport for NSW. And at the Bays Precinct and along Parramatta Road, UrbanGrowth has been hampered by the failure of other parts of government to deliver on a transport plan.
Apart from a commitment some time in the next decade to deliver a metro line, there remains no transport plan for the Bays Precinct. And along Parramatta Road, where UrbanGrowth had once envisaged fostering the development of 50,000-odd new properties, the lack of a transport plan saw that target halved to about 27,000.
It is understood that no decision has yet been made about the restructure. Labor leader Luke Foley has said UrbanGrowth should be split: one side would focus on land release for first home buyers, the other on property projects like the Bays.
Planning Minister Anthony Roberts would not confirm the internal review and offered a strong defence of UrbanGrowth's record.
"As the Premier has made clear, this government is committed to housing affordability; we believe the most effective way of tackling housing affordability is to increase supply and UrbanGrowth NSW plays a vital role in the strategic planning of both greenfield and brownfield sites, enabling the growth of Sydney and NSW," Mr Roberts said.
"Of course we are always looking for new ways to improve the way we plan our housing and key infrastructure projects," he said.
UrbanGrowth, which has made significant progress on its development plans in Newcastle, has been without a chief executive since its former boss, David Pitchford, resigned in December.
The agency on Wednesday released a draft sustainability strategy that commits to developments on government-owned land in Sydney becoming carbon neutral, producing zero waste, and contributing to the water supply by 2028.
