Construction giant Lend Lease’s plans to create a new $709 million residential and commercial neighbourhood at the southern end of Darling Harbour have move closer to fruition with the approval of concept plans for the redevelopment.

On Monday, New South Wales Minister for Planning and Infrastructure Brad Hazzard announced that subject the department had approved concept plans for the revitalisation of Haymarket.

Set to form a key component of a broader $2.5 billion makeover of the Darling Harbour Precinct, the plans will see the creation of a new neighbourhood between Chinatown and Darling Harbour and will include nearly 150,000 square metres of residential floor space with the capacity for 1,360 new apartments and 422 student accommodation units, almost 50,000 square metres of commercial and retail space, new streets and laneways and a major pedestrian boulevard running north-south through the precinct including street furniture and public art spaces and two secondary public domain areas.

Hazard says once complete, the new neighbourhood will represent a lively inner city residential and business community and will help meet demand from residents and students wanting the best of urban life and also be enjoyed by visitors attending conventions in Darling Harbour.

“This is a green light for planning and full steam ahead for the remaking of Haymarket as part of our magnificent world city,” Hazzard said, adding that public submissions made during the exhibition of the concept proposal had identified concerns associated with overshadowing, privacy and loss of views but that the department had concluded these impacts were acceptable. “Whatever your interest, whether it be won tons or waterfront, you will find it here.”

Approval for Haymarket comes as site preparation work on the $2.5 billion makeover started this week following the closure of the existing convention and entertainment centre, with crews working inside the buildings to remove interiors and disconnect services.

That in turn followed the finalisation of arrangements last week regarding the financing of the project.

Whilst the concept plan for Haymarket has been approved, separate development applications have to be approved for the individual student accommodation and residential and commercial office projects before construction can start.

Hazzard said the new neighbourhood is expected to generation more than 2,000 jobs during construction and an additional 2,000 ongoing jobs.