Mambo Wetlands has been saved but the threat to Port Stephens' koala population still looms large as a result of urban development, according to the group that has rescued and cared for hundreds of the native animals.
The state government was last week forced to spend $420,000 buying back the six-hectare parcel of sensitive koala habitat that it sold to a developer for $250,000 in 2016.
Port Stephens Koalas, which was among the groups that forced the government to admit its mistake, said attention now needed to focus on the potential loss of habitat around Anna Bay, Salamander Bay and Kings Hill.
"It would be terrible if these breeding areas were destroyed," president Carmel Northwood said.
"Just because this [Mambo Wetlands] has been saved doesn't mean the other threats have disappeared."
The NSW Threatened Species Scientific Committee declared in 2017 that the area's koalas faced "a very high risk of extinction...in the near future."
As part of its report the committee found that habitat had become highly fragmented due to clearing for agriculture, housing, sand mining and roads. New developments proposed in the area would take in more than 1200 hectares of koala habitat.
Further, the Tomaree koala population would decline to extinction within a decade at the current mortality rate.
"There are some big development applications, things are not looking good," Ms Northwood said.
She said it was pleasing that there had been little change to the physical environment of the Mambo Wetlands while it was in private hands.
"Thankfully no land clearing occurred," she said.
"There are a few more weeds there now because landcare groups haven't been working in there but that can be rectified."
She estimated about 50 koalas may be living in the area.
"No one really knows," she said.
"Our group has rescued and released 296 koalas in that area over several years."
Port Stephens MP Kate Washington said the wetlands should never have been sold.
"The taxpayers of NSW now deserve to know how much this debacle has cost them," she said.