Haymarket Backpacker Plan Finally Wins Green Light

Developer-operator Bounce has succeeded where others could not, winning approval for an ambitious 15-storey backpackers development in Sydney’s Haymarket after a court appeal.

The hostel operator, which has sites from St Kilda to Airlie Beach, comprises LCI Partners and The Tourism Co.

It submitted its plans to the City of Sydney for the 14-storey project in early 2025.

Bounce wanted to demolish most of the existing buildings, retaining just the facade on George Street, and build a tower at the back of the site for backpackers as well as hotel accommodation. 

The $26.75-million scheme includes bars, a cafe and a rooftop pool on the site at 806-812A George Street, 2.4km from the Sydney CBD.

Bounce proposed 577 backpacker beds across 84 rooms, plus eight hotel rooms and 58 carparking spaces.

The majority of the rooms provide dorm-style beds in configurations of eight or six a room, while the hotel rooms are of one bed a room as a higher-end option.

An earlier attempt by Fuqiang Investments for a similar 15-storey project that included rooms for 299 guests was refused in 2019. 

It was later approved for a much smaller, 10-storey project through the NSW Land and Environment Court (LEC) in 2020 at the height of the Covid pandemic. That development did not proceed.

▲ Rendering of the rooftop pool area. The project was designed by MKD Architects.

The latest proposal was also refused by the city, which did not make a determination in the prescribed timeframe.

The council subsequently raised issues, including a lack of support from Transport for NSW, site contamination and flooding risks, a failure to exhibit design excellence, inadequate amenity and “unreasonable impacts” on neighbouring properties. 

Bounce launched an appeal against the refusal in the LEC.

After six conciliation conferences in 2025, the council and the developer agreed on design amendments to improve its architectural expression. 

The amendments include improving communal spaces and accommodation, increasing floor-to-ceiling heights, and consolidating the rooftop pool to reduce building mass. 

▲ The Haymarket backpackers project was based on earlier, unsuccessful plans.

The developer also provided extra information to resolve the council’s other problems, although objections remained from the neighbouring heritage-listed church over what it called “excessive bulk and scale”. 

The amended DA was renotified at the end of 2025, with no new issues raised.

The court ruled that the project was consistent with the aims of Sydney’s local environment plan to help the city participate in the global economy and promote a diversity of commercial and housing opportunities. 

The court approved the amended plans and permitted the backpacker project to move ahead.

International tourists to Australia have returned to near pre-Covid levels, reaching about 8 million trips in the year to September 2025.

Backpackers accommodation has grown in response—including plans for a 1000-bed Chippendale hostel approved last year.

The hotel sector is also experiencing a surge, including adaptive reuse plans for the Kent Street Universal Pictures building and a George Street heritage building.