His family's No. 5 Restaurant & Bar is the only licensed venue in the McEvoy Street precinct dominated by cavernous warehouses, smash repair shops, sign-writing businesses and gyms.

"We thought, build it and let's see how it goes," Mr Jackson said. "We're a bit lonely here."

That's all set to change, if the City of Sydney gets its way.

The council wants to transform part of the Alexandria industrial area -- with its grungy laneways, sawtooth-design warehouses and towering fig trees -- into a buzzing arts, entertainment and cultural hub.

It's part of proposed planning control changes that would allow business within the four hectare site to trade around-the-clock under a plan to scatter more night-time hotspots throughout the city.

Mr Jackson said his family, which runs a manufacturing business from the warehouse next door, thought the site represented "a good opportunity" for a bar and restaurant.

"Over the past 10 years there have been heaps of apartments going up, you've got Green Square right there. Redfern's changing too, but there's still not much at this end," he said.

On Monday Lord Mayor Clover Moore released her plan to revitalise the city's night-life as "a renaissance for Sydney" by changing planning controls to promote an after-dark economy and create night-time hotspots close to residential areas.

Under the plan, shops, restaurants and other businesses across Sydney's central business district could trade 24 hours a day.

Trading hours for small bars and restaurants in main street areas in Glebe and Surry Hills would be extended, and new night-time hotspots created in fast-growing neighbourhoods such as Barangaroo, Green Square and Danks Street in Waterloo.

The changes would not affect licensed premises in Sydney's CBD and Kings Cross covered by the city's lock-out laws.

The mayor said the Alexandria industrial site was chosen for its proximity to residential areas and public transport.

"It's about the future of the night-time economy," she said.

"This is a very rapidly developing residential area and in the future people will want interesting spaces for cultural activities, for live music, and we see real opportunities here.

"This isn't something that will happen overnight, but we think there will be a very strong response from industry."

Councillor Jess Scully said the proposal would "safeguard" the heritage-protected warehouses for the future and, if approved, the precinct might not start to take shape for several years.

"The warehouse building stock is so perfect for such a range of uses, from a brewery to a gin cellar door, to nightclubs or performance venues."

"Our job is to plan, it's up to the arts industry and creative sector to "colour in" that outline."

Mr Jackson hoped the plan would would encourage neighbouring businesses to consider new uses for their warehouses. "I'm quite excited about it. It sounds like a good plan."

The council's planning policy manager, Ben Pechey, said the reforms would provide clearer rules for late-night trading.

He said most warehouses were privately owned and interested owners would need to put a development application into the council.

Sydney Business Chamber executive director Patricia Forsythe said she supported 24-hour trading in the city centre "in principle". However, she said keeping a door open 24 hours was unviable for some businesses at present.

The council will consider the draft planning controls on November 19. If approved, the plans will be put on public exhibition until February.