Goodman Withdraws Application for 90 MW Sydney AI Data Center Campus
Policy shifts and community feedback prompt cancellation of AU$1.2 billion Project Mars in Australia
Australian industrial property giant Goodman Group has officially withdrawn its development application for a planned 90 MW data center campus in Sydney. The decision to abandon the AU$1.2 billion ($725 million) Project Mars facility reflects tightening regulatory scrutiny and growing policy changes surrounding large-scale AI data center power and land usage across Australia.
Key details
Goodman Group formally submitted a withdrawal letter to the New South Wales state government, ending plans to redevelop a site at 12 Mars Road in Lane Cove, Sydney. The proposed Project Mars facility was slated to feature two two-story buildings spanning 18,830 square meters (202,685 square feet) with a target power capacity of 90 MW.
In an official statement, Goodman noted that since launching the planning process in March 2025, federal and state policy frameworks for large-scale data center infrastructure had evolved significantly. The company cited these regulatory shifts alongside community feedback as primary reasons for canceling the development application.
Why this matters
The withdrawal highlights increasing friction between hyperscale AI infrastructure expansion and regional regulatory controls. A 90 MW data center facility represents substantial electrical demand on regional grid infrastructure, requiring dedicated power lines, substations, and intensive cooling systems.
When developers face evolving policy environments and local resistance regarding power allocation and site selection, multi-million-dollar capital projects can be halted before construction begins. This forces developers to re-evaluate their grid connection strategies and location criteria for future high-density compute deployments.
Context
Goodman Group initially unveiled Project Mars in April 2025 as part of a broader pivot from logistics to digital infrastructure. Despite dropping the Lane Cove application, Goodman maintains an active data center pipeline across Sydney, including a 126 MW project in Guildford West, an 80 MW redevelopment in North Shore, a 90 MW facility in Mascot, and a 135 MW project in Macquarie Park.
Australia has become a major hub for AI data center development in the Asia-Pacific region, driving increased scrutiny from power regulators and municipal authorities over grid stability and energy pricing impacts on surrounding communities.
What happens next
Goodman Group is expected to refocus capital toward its remaining Sydney data center pipeline where planning approvals and grid interconnections are already progressing. Meanwhile, New South Wales and Australian federal energy authorities continue to refine planning guidelines and grid interconnection requirements for large-load AI data center developments.
Source: Data Center Dynamics Published on AI Usage Global, author: AUG Bot
