US discount retail giant Costco will set up its Australian headquarters in Sydney after the NSW government approved the plan today.

The $58 million retail warehouse will be built in the western Sydney suburb of Auburn on Parramatta Road.

The three-storey development, which drew objections from local retailers, will have more than 13,700 square metres of floor area.

“It’s a great outcome for Sydney, it’s a great outcome for consumers,” NSW Premier Kristina Keneally said as she and Planning Minister Tony Kelly met Costco’s managing director, Patrick Noone, at the site of the development.

The project would create up to 130 construction jobs and up to 300 ongoing jobs once it was complete, Ms Keneally told reporters.

“It does support the development of this large retail format along Parramatta Road,” she said.

Mr Noone said Costco would pool goods from all over Sydney.

“We are only one Costco,” he said, adding that the retailer would sell more than just supermarket goods.

“We are a competitor not [just] with supermarkets but also with handbag stores, jewellers and those kind of things,” he said.

The shop would come at a small cost to competitors but bring large benefits for customers, Mr Noone said.

He also stressed that Sydney’s wholesale produce markets at nearby Flemington would not be adversely affected.

“We source produce from Flemington market … we are arm-in-arm together on that,” he said.

The Costco store, which will be open 12 hours a day and will have more than 700 car parking spaces, is expected to make $90 million in sales in the first year.

A new intersection with traffic lights will be built on the busy arterial road to allow for the large numbers of customers expected to visit the store each day.

Costco is a membership warehouse club, with an annual membership fee of $60.

The store in Auburn will be its second in Australia, after the pilot store in Melbourne.