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'town development' is correct and usable in written English.
You could use it to refer to the process of improving and modernizing a town, such as when discussing government funding for transportation or housing initiatives. Example sentence: The mayor proposed a plan for town development, which would include new infrastructure and public services.
Exact(43)
Development of 'beacon' practices may involve partnerships between organisations as diverse as government, non-government organisations (NGOs), local health services, and even a satellite town development group as is occurring across our developing sites.
It is a classic new town development – though this one has one unexpected feature.
Substantial multi-billion pound loans made by the Treasury to new town development corporations were subsequently paid off.
Barron Collier and Mr. Monaghan will each have a half interest in the town development, and Mr. Monaghan said his profits would go toward endowing Ave Maria.
In Jakarta's old town, development comes with a price – and the city administration gets to decide who stays and who leaves.
Relatively rapid land acquisition – acquiring thousands of acres at "existing use" or agricultural value – was the key to new town development.
Similar(17)
What I'm opposed to is an out-of-town development.
They also preferred Tesco's town-centre plan to a rival out-of-town development.
However, as anyone who has seen an out-of-town development for the past 30 years knows, it means something quite different in practice.
If the law is passed, as expected, Mamaroneck officials said they would take legal action against any out-of-town development that ignored the requirements.
A well-off single man, he takes one of the bachelor flats near the top of a colossal new apartment block in an out-of-town development of five new buildings.
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Since I tried Ludwig back in 2017, I have been constantly using it in both editing and translation. Ever since, I suggest it to my translators at ProSciEditing.

Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com