Goodman Scraps $1.2B Sydney Data Centre as New Rules Emerge
Goodman Group has withdrawn its $1.2 billion Project Mars data centre proposal for Lane Cove in Sydney's north. The plans were removed from the NSW planning portal on Monday, with the withdrawal reported on 28 September 2026. The Guardian
The proposal centred on 12 Mars Road, Lane Cove West, where Goodman proposed to build and operate a three-storey data centre. Goodman Planning records describe it as a 90MW data centre, a rating that sets how much electrical power it could draw at full use. NSW Planning Portal The scheme involved demolition of four existing industrial warehouse buildings on the site. Its NSW planning application reference was SSD-82052708.
Goodman said the policy and regulatory environment for large-scale data centres had evolved significantly. Having considered emerging federal and state policy, the company said it will not progress with the development application for Project Mars. The decision followed extensive technical investigations.
In August, the NSW government announced a fast-track framework promising to assess data centre applications within 75 days if they meet set principles. In July, the federal government announced rules addressing data centre location choices and energy and water use requirements, with legislation expected in federal parliament early next year. Goodman Group general manager for development Ben McGilp told the Senate inquiry into data centres that the company supports "clear, consistent and evidence-based regulation".
The Lane Cove proposal was criticised by local residents over proximity to schools, event spaces and green space and concerns about clustering of data centres in Lane Cove.
The broader context here is sequencing. Goodman withdrew a detailed plan rather than test it against rules still being drafted. It is like finalising house plans before the building code is finished. For operators in New South Wales, design is now being fixed before regulation is fixed. Projects based on earlier assumptions face retrofit, redesign or exit if location, energy and water tests shift.
In my view, Lane Cove clarifies where leverage sits. Neighbourhood objections focus on amenity and concentration. State and Commonwealth frameworks focus on systems: where large loads should sit, and what they may draw. Developers must now satisfy both at once. Withdrawal avoids a contested determination and keeps capital intact for sites that fit the coming tests.
Looking ahead for planners and the industry, the 75-day state pathway and the foreshadowed Commonwealth legislation will do the sorting. Applications able to meet set principles on location and resource use will move faster. Others will stall. Project Mars becomes an early example of that filtering, not through approval but through retreat.
