Sea-level rise increasingly affects low-lying and exposed coastal communities due to climate change. These communities rely upon the delivery of stormwater and wastewater services which are often co-located underground in coastal areas. Due to sea-level rise and associated compounding climate-related hazards, managing these networks will progressively challenge local governments as climate change advances. Thus, responsible agencies must reconcile maintaining Levels of Service as the impacts of climate change worsen over the coming decades and beyond. A critical question is whether such networks can continue to be adapted/protected over time to retain Levels of Service, or whether eventual retreat may be the only viable adaptation option? If so, at what performance threshold? In this paper, we explore these questions for stormwater and wastewater, using a dynamic adaptive pathway planning (DAPP) approach designed to address thresholds and increasing risk over time. Involving key local stakeholders, we here use DAPP to identify thresholds for stormwater and wastewater services and retreat options, and for developing a comprehensive and area-specific retreat strategy comprising pathway portfolios, retreat phases, potential land use changes, and for exploring pathway conflicts and synergies. The result is a prototype for an area near Wellington, New Zealand, where a managed retreat of water infrastructure is being considered at some future juncture. Dynamic adaptive strategies for managed retreats can help to reduce future disruption from coastal flooding, signal land use changes early, inform maintenance, and allow for gradual budget adjustments by the agencies that can manage expenditure over time. We present this stepwise process in a pathway form that can be communicated spatially and visually, thereby making a retreat a more manageable, sequenced, adaptation option for water agencies, and the communities they serve.