A revamped multimillion-dollar plan to transform the waterfront between the Harbour Bridge and Barangaroo into an arts precinct has been given the green light and received the cautious support of the Sydney restaurant owner who had stopped it.

The $207 million development of the Walsh Bay Arts Precinct has received final planning approval paving the way for the refurbishment of performance, production and rehearsal spaces for the Sydney Theatre Company, Sydney Dance Company, Bangarra Dance Theatre, Australian Theatre for Young People, Gondwana Choir, Sydney Philharmonia Choir and The Song Company.

Artist's impression of how the Walsh Bay precinct will eventually look.

At Pier 2/3, the last remaining undeveloped wharf in Sydney will become the new home of the Australian Chamber Orchestra and Bell Shakespeare.

A large heritage commercial events/art space has been retained to host events such as Sydney Writers' Festival and Biennale of Sydney .