Newcastle Basketball will proceed with plans to build a new stadium at Glendale after its application was rejected for Hillsborough.
Newcastle Basketball said the Hunter and Central Coast Regional Planning Panel's decision was "expected given the constraints and conditions" on the site.
The NSW Government has committed $25 million to the new stadium, and "will continue to work with Newcastle Basketball on the project".
The Herald previously reported Newcastle Basketball was looking at a site in Glendale while the Hillsborough proposal was being assessed. General manager Neil Goffet said Glendale plans were "well underway" and expected to lodge a development application within months.
But Newcastle council CEO Jeremy Bath said Hillsborough being ruled out allowed for talks between Newcastle Basketball and Venues NSW about building a stadium in the proposed Hunter Sports and Entertainment Precinct, near the current Broadmeadow facility.
"Hunter Park addresses all of the issues that saw the Hillsborough Road site fall over, including access to both bus and rail, hospitality and accommodation venues, as well as integration with regional level sporting infrastructure such as McDonald Jones Stadium and a proposed new entertainment centre and car park," Mr Bath said. "In order for a basketball stadium to be included, there is now a window of several months for Newcastle Basketball to decide if they want in."
Mr Goffet previously told the Herald the Broadmeadow facility was "not fit for future development" and NewFM reported him saying "we don't fit into plans" to redevelop McDonald Jones Stadium precinct.
Charlestown MP Jodie Harrison, whose electorate Hillsborough is in, said she would have loved a stadium in Charlestown, but the site needed to be "sensible".
"One of the key reasons it fell over was a lack of communication," she said. "There was a haste.
"I've been talking to members of the community for years about this. It would have been a massive impact on them. I hope there are learnings out of this."