The SmartGrowth Partnership, which includes the local and regional councils, tangata whenua and central government, estimated an additional 43,000 homes were needed in the region by 2048.
The partners have identified the Western Corridor as key to meeting this demand and have been looking at how this area can be unlocked for development.
Tauranga City Council formally requested that Kāinga Ora consider the Western Corridor for selection as a potential SDP under the Urban Development Act 2020.
Tauranga City Council Commissioner Stephen Selwood said despite the Western Corridor being identified for urban development through SmartGrowth, the council had found it difficult to make substantive progress to enable development in the area.
"The size and scale of the planned growth, necessary investment in infrastructure and complexity of structure planning and rezoning under the Resource Management Act 1991 (RMA) has slowed development in the Western Corridor," Selwood said.
"Tauranga has a significant housing gap and is the only metropolitan area in New Zealand which cannot comply with the housing supply requirements set out in the Government's National Policy Statement on Urban Development.
"The latest projections show that over the next 10 years, the city will be between 7000 and 9000 homes short of the number the city needs."
Selwood said it was critical that the planning, infrastructure and funding for urban development were agreed upon upfront to deliver housing and urban development at the pace and scale required.
"A Specified Development Project would provide a process to deliver that integrated planning in the short term, while still allowing the opportunity to future-proof the Western Corridor for envisaged growth over the medium and long term."
Kāinga Ora General Manager Urban Planning and Design Katja Lietz said initial considerations suggested the Western Corridor could benefit from Kāinga Ora using its urban development tools to facilitate development in the area.
"Specified Development Projects can provide a way for Kāinga Ora to enable transformational, complex urban development.
"The Western Corridor presents a significant opportunity for the SmartGrowth Partnership, tangata whenua, private developers and landowners to work together to deliver a sustainable, inclusive and thriving community for the people of Tauranga.
"This is one of the fastest-growing regions in the country and our focus during the assessment process will be to determine whether these new urban development tools are the right ones to support a well-planned, high-quality urban development that meets the needs of the community."