A plan change to rezone 46.8ha of Wanaka land for residential activities, visitor accommodation and business has been adopted by the Queenstown Lakes District Council's strategy committee.
Ballantyne Investments Ltd owns most of the land, which is north of the Three Parks development, and has worked with the council since Plan Change 4 - North Three Parks started in February 2010.
Sitting near the Wanaka golf course, the land could also be used for sports facilities.
A report from QLDC senior policy analyst Sue Mavor described the site as the "logical location for any urban expansion, as it will link Three Parks to the existing urban area".
"The plan change will form a sensible progression for development and will reduce the likelihood of pockets of urban development being located among rural land remote from the Wanaka urban area."
Cr Trevor Tattersfield expressed concern the re-zoning could mean there was too much land zoned for residential development but Mrs Mavor said the council was going ahead "because it's a sensible progression with a willing developer".
"The projected figures show growth in Wanaka and the projected growth will happen," she said.
