The Baird government's plan to sell one of the largest coastal plots still available in the city is capturing the attention of major developers keen to build in the Long Bay prison complex.

The closure and sale of the Malabar jail and construction of a new, larger prison in south-western Sydney will be accelerated as the government seeks to cope with a record number of inmates.

The state government has accelerated plans to sell Long Bay jail. Credit:Sahlan Hayes

The 32-hectare jail site will be sold for hundreds of millions of dollars to developers, although no firm timeline for the closure of the prison has been released.

It is likely the government's property development arm UrbanGrowth NSW would be called upon to create a master plan for the future of the site, which is on the state heritage register.