Sydney data centre plan scrapped by developer after community backlash

AUSTRALIAN industrial property developer Goodman Group has withdrawn an application to develop a 24-hour data centre on Sydney’s north shore following public pushback. 

Goodman said it won’t proceed with its Project Mars development application after considering evolving federal and state policy and community feedback. Policy and regulation around large AI data centres had “evolved significantly” since planning began in March 2025, the company said in a statement. 

The project was worth A$1.2 billion (US$842 million), according to the Australian Financial Review and other media outlets. 

Australia is undergoing a rapid data centre buildout, attracting investment due to its abundant land and renewable-energy potential.

The country’s data centre pipeline is worth about A$175 billion, with roughly A$110 billion of that investment likely to occur over the next three years, Westpac Banking Corp. senior analyst Pat Bustamante said in a research note this month. 

Project Mars was planned for the residential suburb of Lane Cove, roughly 20 m from the nearest home and 160 m from a public school, according to the Australian Broadcasting Corp. The proposal drew criticism from residents and activists amid broader concerns about locating data centres near homes. 

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Victoria state recently also banned the construction of data centres in residential areas and said such facilities must “bring their own renewable energy supply.” BLOOMBERG