The city is regarded as one of the world's most naturally beautiful and has regularly been voted as one of the top destinations in international tourist polls.
But a plan to make Sydney more people-friendly by architect Jan Gehl found city streets were often in shadow due to high-rises, which formed concrete and glass canyons of high wind velocity, and that its open spaces were also bland.
"Sydney CBD (central business district) was filled up to the brim with car traffic 30-40 years ago. But this situation has remained unchallenged and unchanged ever since," Gehl told Reuters via email.
"Climate challenge, oil shortages and lifestyle changes will see most Western cities change from the car orientation of the 1950s to a much more sustainable and healthy agenda."
Gehl will present the plan to the city council, which had commissioned it, on Monday. He has prepared similar studies for London, Copenhagen, Wellington, Stockholm, Rotterdam and Zurich.
He said several cities such as Lyon, Copenhagen and Melbourne had improved their city centres to make them more attractive.
Sydney enjoys a "distinctive topography" with its grand harbour and undulating landscape providing "significant character", said a draft of Gehl's plan.
Current harbourside development will see a 12km walk along the foreshore from Woolloomooloo in the east, past the main ferry terminal of Circular Quay, to Pyrmont in the west.
But massive infrastructure in the city sees 150,000 vehicles passing through the centre and another 80,000 through its parklands, cutting the city off from the harbour.
"Circular Quay where the city does access the water is downgraded by a bulky ferry terminal and a likewise railway embankment as well as low quality retail," the draft said.
"Darling Harbour is isolated, not only by closed frontages but also by an intersecting freeway."
Former Australian Prime Minister Paul Keating has described Sydney as an "architectural wasteland" saved only by its harbour.
Gehl said he agreed in part with the criticism. "We have found great things in Sydney CBD, but mainly at the edges and other aspects are not so remarkable," he said.
Sydney was an ideal size for pedestrians, taking 12 minutes to walk across from east to west and 30 minutes south to north, said Gehl's plan. But pedestrian priority was low and there was a lack of cycling facilities, despite Sydney having excellent natural conditions for a strong cycle culture.
Gehl said there were several ways for Sydney to reach a "new balance", citing a congestion charge on cars in London and Stockhol and Copenhagen's reduction of car parking spaces.
His plan calls for Sydney to develop car free streets, shift transport hubs from the city centre to its periphery and develop a low cost or free lightrail the length of the city.
The plan also controversially calls for the demolition of two major commuter routes - the western distributor freeway and the freeway and rail link above the ferry terminal.
"San Francisco had central freeways crumbling after the (1989) earthquake. They were removed and have not been replaced. The city is happily living with less traffic in the centre," Gehl said.
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