The council will call for registrations of interest from developers interested in opening up the big block of council-owned land in the central part of the Omokoroa Peninsula.
Mr Paterson also highlighted the build-up of traffic between Te Puna and Bethlehem in the morning rush hour, with the longer time needed to get to work and school leading to calls to advance construction of the Tauranga Northern Link that will bypass Bethlehem.
He said the agency also needed to reassess the Katikati bypass on the basis of the economic benefits and savings in journey times. "The bypass is well overdue."
The agency's acting Waikato/Bay of Plenty director Robert Brodnax said SH2 was a major focus and they were working as hard and as fast as they could on a business case to enable funding for short and long-term changes.
He said they were extremely serious about safety along the northern corridor and had set aside funding following the business case. Mr Brodnax said it was too early to determine what the improvements would be. "We are looking at the Omokoroa Rd intersection as part of this work."
Changes to the intersection would be part of a suite of safety improvements along SH2.
He said the National Land Transport Programme 2015-18 was a snapshot of planned investment and projects could move in or out, or advance or slow down. The Katikati bypass was on hold because the design and construction phases were below the threshold for further investment.
"At this point, we have not got strong evidence of severe congestion or significant community severance."
The focus for the northern corridor was on safety improvements to create a more forgiving road environment, Mr Brodnax said.
The Bay of Plenty Regional Council's land transport plan ranked the Northern Link at 9th on its priority list and the Katikati Bypass at 19th.