Canterbury Racecourse site. The racecourse, about 300 metres from Canterbury Station, is now firmly on the Department of Planning's radar. A preliminary planning process is looking at the suitability of the site for a new residential community with heights ranging from three to 18 storeys. "The master plan will consider all of the racecourse land and will consider the potential for new homes as well as open space and community facilities," a department of planning spokesman said. It is understood the ATC has no immediate plans to sell the site. It is constrained by a 10-year legal requirement preventing its sale until 2021 at the earliest. The moratorium on the sale was imposed when Sydney Turf Club, which owned the racecourse, and Australian Jockey Club merged to become the Australian Turf Club in 2011. Richard Colley, administrator of Canterbury-Bankstown council, described the racecourse as a "very significant site due to its size and location".

He said the council was yet to have any discussions with state government in relation to the masterplan and said any future planning needed to prioritise schools, houses and roads "before housing numbers and targets are set". "It is time we started to plan for people first, then buildings, not the other way around." A planning department spokesperson said final building heights, the number of homes that could be built on the racecourse, and the potential for open space would be determined through the master planning process. However, recent large-scale urban developments in the inner Sydney area give an indication of the racecourse's lucrative development potential.

In 2010, the sale of Harold Park Paceway, in Glebe, to Mirvac netted NSW Harness Racing Club $187 million. The developers built 1250 units across the 11-hectare site, costing $1 billion. In Erskineville, a $1.6 billion development is under way to build 1600 apartments on the seven-hectare Ashmore industrial estate. The NSW government's interest in the potential redevelopment of the racecourse was flagged in a revised Sydenham to Bankstown development strategy, released last month. The upgrade of the train line to more frequent "metro" trains next decade has prompted the government to push for 35,000 new homes along the corridor. Drawing on advice commissioned from the urban consultancy firm, JBA, the strategy included the racecourse as part of a new "priority precinct" around Canterbury station, where 4000 new homes are already expected to be built by 2036 through zoning changes. The strategy identified the racecourse as ideally suited to medium to high-rise residential development between three and 18 storeys, potentially adding thousands more homes. Background planning documents, commissioned by the government in the course of developing the strategy, also identified the site as a suitable location for a new school.

The inclusion of the racecourse in the revised plans represents a significant change in the department's planning strategy for the area. The racecourse redevelopment potential was not considered by initial strategy released in 2015, other than a reference to it as a "significant opportunity site should its current use change". A department spokesperson said its inclusion in the new plans was driven by "feedback from the community, including from the Australian Turf Club, recommending the racecourse be investigated for new homes and open space". However the ATC's submission, also prepared by JBA and lodged in 2016, advocated only the rezoning of parts of the racecourse, totalling 6.5 hectares, which it considered "surplus to the operations of the racecourse". In 2015, the ATC flagged its plans to sell off these surplus parcels of land, which are on the fringe of the racecourse and are mostly used for car parking. The Department of Planning said there was no timeframe yet on the preparation of the racecourse master plan. Once it is prepared, it will be put on public exhibition for the community to provide feedback.