Premier Gladys Berejiklian will take personal responsibility for major inner city development projects at the Bays Precinct and along the Central to Eveleigh rail corridor, following an administrative reshuffle.
The changes mean that UrbanGrowth, the government development agency, will in effect be split in two. The UrbanGrowth Development Corporation will report to the Premier, and will be responsible for large-scale inner city housing and development cites.
Landcom, the land release agency that had been re-branded as UrbanGrowth, will continue to report to the Planning Minister, Anthony Roberts.
The move to place large-scale inner city projects, for instance the Bays Precinct which includes the redevelopment of Sydney Fish Markets, under the control of Ms Berejiklian, will be framed as elevating their importance within government.
The Barangaroo Delivery Authority, which has managed the redevelopment of Barangaroo, has been under the control of the Department of Premier and Cabinet.
Fairfax Media has previously revealed that a Premier and Cabinet report last year recommended breaking up UrbanGrowth. Since that report, it has been unclear whether the large-scale inner-city development projects would be moved under the control of the Minister for Transport and Infrastructure, Andrew Constance, or Ms Berejiklian.
"UrbanGrowth has got the city and Landcom has got the west," was how one source described the impending split of the agencies.
It is unclear which agency will control other development projects across Sydney, such as the planned North Parramatta program.
Ms Berejiklian has said that housing affordability, to be addressed primarily through increased supply of housing, would be a major priority of her government.
Labor's planning spokesman, Michael Daley, criticised Ms Berejiklian's record in selling public land and infrastructure.
"Putting Gladys Berejiklian in charge of Sydney's biggest urban redevelopment and renewal projects is like putting the fox in charge of the hen house," Mr Daley said.
"These once in a lifetime urban renewal sites should be redeveloped thoughtfully and tastefully and a large proportion of the redevelopment should go towards tackling the housing affordability crisis in Sydney," he said.