Singleton Mayor Sue Moore and Maitland Mayor Peter Blackmore said they were surprised at yesterday's outcome but not disappointed, while Cessnock Mayor Alison Davey doubted this would be the last her council heard of Huntlee.

"A big investment has gone into this and a way around it may be brought forward," Cr Davey said.

Cr Moore said the collapse could work in Singleton's favour with people who were thinking of making Huntlee their home, looking at Singleton as an option.

"We have been doing planning and realising how hugely difficult it would be to have a town of that size so close to Singleton," she said.

"There were also concerns how the two local government areas it was to sit across were going to work infrastructure and planning regulations."

Cr Blackmore is angry the state did not consult Maitland City Council about Huntlee.

"Without the F3 link Maitland would have had traffic from Huntlee coming down the New England Highway and into the city," Cr Blackmore said.

"We were never consulted at the time. I hope this doesn't mean the stalling of the F3 link road."

Hunter Business Chamber chief executive officer Peter Shinnick said the Hunter would need to accelerate redevelopment and growth in existing areas or risk local economic downturn if greenfield sites were not available.

Port Stephens Mayor Bruce MacKenzie said the collapse of Huntlee made a mockery of the State Government's Lower Hunter Regional Strategy and that the Government needed to act quickly to avoid a major housing shortage.

Cr MacKenzie called on state planners yesterday to "make some decisions" about key land release areas planned for Port Stephens.

Kings Hill, at North Raymond Terrace, will become the Hunter's largest and most critical strategic land release should the Huntlee development fall over completely.

Cr MacKenzie called for immediate action on Kings Hill, as well as land releases planned for Karuah, Anna Bay, Medowie and Wallalong.

Major development plans at Wallalong, ignored by the Lower Hunter Regional Strategy and not supported in the short-term by the State Government for that reason, now had a better chance of support, he said.