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fix: deploy with separate locations for models and other foundry projects #7873

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fix: deploy with separate locations for models and other foundry projects #7873

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40 changes: 33 additions & 7 deletions cli/azd/extensions/azure.ai.agents/internal/cmd/init_foundry_resources_helpers.go
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Original file line number Diff line number Diff line change
Expand Up @@ -654,11 +654,18 @@ func loadAzureContext(
envValueMap[value.Key] = value.Value
}

// Use AZURE_AI_DEPLOYMENTS_LOCATION for Scope.Location (used for model filtering).
// Fall back to AZURE_LOCATION for backward compatibility with older environments.
location := envValueMap["AZURE_AI_DEPLOYMENTS_LOCATION"]
if location == "" {
location = envValueMap["AZURE_LOCATION"]
}

return &azdext.AzureContext{
Scope: &azdext.AzureScope{
TenantId: envValueMap["AZURE_TENANT_ID"],
SubscriptionId: envValueMap["AZURE_SUBSCRIPTION_ID"],
Location: envValueMap["AZURE_LOCATION"],
Location: location,
Comment on lines +657 to +668
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Copilot AI Apr 22, 2026

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loadAzureContext now prefers AZURE_AI_DEPLOYMENTS_LOCATION over AZURE_LOCATION. This is behaviorally significant for model filtering and project selection; there don’t appear to be unit tests covering the precedence/fallback behavior. Consider adding tests for (1) AI var set, (2) only AZURE_LOCATION set (back-compat), and (3) neither set.

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},
Resources: []string{},
}, nil
Expand Down Expand Up @@ -728,7 +735,9 @@ func ensureSubscription(
}

// ensureLocation prompts for an Azure location if not already set in the AzureContext.
// Both init flows use this.
// Both init flows use this. Sets both AZURE_LOCATION (resource group) and
// AZURE_AI_DEPLOYMENTS_LOCATION (AI/model resources) to the same value as a default.
// If the user later picks a different model region, only AZURE_AI_DEPLOYMENTS_LOCATION changes.
func ensureLocation(
ctx context.Context,
azdClient *azdext.AzdClient,
Expand All @@ -738,7 +747,8 @@ func ensureLocation(
allowedLocations := supportedRegionsForInit()

if azureContext.Scope.Location != "" && locationAllowed(azureContext.Scope.Location, allowedLocations) {
return nil
// Location already set and valid — ensure AZURE_AI_DEPLOYMENTS_LOCATION is also set
return setEnvValue(ctx, azdClient, envName, "AZURE_AI_DEPLOYMENTS_LOCATION", azureContext.Scope.Location)
Comment on lines 749 to +751
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Copilot AI Apr 22, 2026

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In the early-return path, azureContext.Scope.Location may have come from AZURE_AI_DEPLOYMENTS_LOCATION (via loadAzureContext). If AZURE_LOCATION is currently unset, this returns without seeding it, leaving the resource group location missing. Consider reading current env values and setting AZURE_LOCATION only when it is empty, while also ensuring AZURE_AI_DEPLOYMENTS_LOCATION is set when empty (without overwriting an existing, user-chosen RG location).

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}
if azureContext.Scope.Location != "" {
fmt.Printf("%s", output.WithWarningFormat(
Expand All @@ -757,7 +767,11 @@ func ensureLocation(

azureContext.Scope.Location = locationName

return setEnvValue(ctx, azdClient, envName, "AZURE_LOCATION", azureContext.Scope.Location)
if err := setEnvValue(ctx, azdClient, envName, "AZURE_LOCATION", azureContext.Scope.Location); err != nil {
return err
}

return setEnvValue(ctx, azdClient, envName, "AZURE_AI_DEPLOYMENTS_LOCATION", azureContext.Scope.Location)
}

// ensureSubscriptionAndLocation ensures both subscription and location are set.
Expand Down Expand Up @@ -1085,10 +1099,22 @@ func selectFoundryProject(

selectedProject := projects[selectedIdx]

// Set location from the selected project
// Set AI deployments location from the selected project.
// The project's location determines where AI models and resources are deployed.
previousLocation := azureContext.Scope.Location
azureContext.Scope.Location = selectedProject.Location
if err := setEnvValue(ctx, azdClient, envName, "AZURE_LOCATION", selectedProject.Location); err != nil {
return nil, fmt.Errorf("failed to set AZURE_LOCATION: %w", err)
if err := setEnvValue(
ctx, azdClient, envName, "AZURE_AI_DEPLOYMENTS_LOCATION", selectedProject.Location,
); err != nil {
return nil, fmt.Errorf("failed to set AZURE_AI_DEPLOYMENTS_LOCATION: %w", err)
}

// Seed AZURE_LOCATION (resource group location) if not already set.
// Default to co-locating with the project; user can override before deploying.
if previousLocation == "" {
if err := setEnvValue(ctx, azdClient, envName, "AZURE_LOCATION", selectedProject.Location); err != nil {
return nil, fmt.Errorf("failed to set AZURE_LOCATION: %w", err)
}
Comment on lines +1102 to +1117
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Copilot AI Apr 22, 2026

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previousLocation := azureContext.Scope.Location is tracking the AI deployments location (per loadAzureContext), not whether AZURE_LOCATION (resource group location) is set. If an environment has AZURE_AI_DEPLOYMENTS_LOCATION set but AZURE_LOCATION unset, this block will skip seeding AZURE_LOCATION, leaving it missing. Consider checking the actual AZURE_LOCATION env value (e.g., via Environment().GetValue/GetValues) before deciding whether to set it.

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}

// Configure all Foundry project environment variables
Expand Down
8 changes: 5 additions & 3 deletions cli/azd/extensions/azure.ai.agents/internal/cmd/init_models.go
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Original file line number Diff line number Diff line change
Expand Up @@ -83,11 +83,11 @@ func (a *modelSelector) updateEnvLocation(ctx context.Context, selectedLocation

_, err := a.azdClient.Environment().SetValue(ctx, &azdext.SetEnvRequest{
EnvName: envName,
Key: "AZURE_LOCATION",
Key: "AZURE_AI_DEPLOYMENTS_LOCATION",
Value: selectedLocation,
})
if err != nil {
return fmt.Errorf("failed to update AZURE_LOCATION in azd environment: %w", err)
return fmt.Errorf("failed to update AZURE_AI_DEPLOYMENTS_LOCATION in azd environment: %w", err)
}

if a.azureContext == nil {
Expand All @@ -98,7 +98,9 @@ func (a *modelSelector) updateEnvLocation(ctx context.Context, selectedLocation
}
a.azureContext.Scope.Location = selectedLocation

fmt.Println(output.WithSuccessFormat("Updated AZURE_LOCATION to '%s' in your azd environment.", selectedLocation))
fmt.Println(output.WithSuccessFormat(
"Updated AZURE_AI_DEPLOYMENTS_LOCATION to '%s' in your azd environment.", selectedLocation,
))
Comment on lines 84 to +103
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Copilot AI Apr 22, 2026

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updateEnvLocation now updates AZURE_AI_DEPLOYMENTS_LOCATION instead of AZURE_LOCATION, and also mutates a.azureContext.Scope.Location. There are unit tests in this package but none covering this env update path; consider adding a test to verify the correct key is written and that the in-memory AzureContext is updated accordingly.

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return nil
}

Expand Down
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