A residents group says the expansion of Manuka Oval threatens to dislodge community groups in the precinct and compromise heritage values.
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Canberra Services Club is considering redevelopment after its club near the oval burnt down in 2011. It has an agreement with Defence Housing Australia to build a new club and residential housing.
A feasibility study will also include a proposal to relocate Manuka Arts Centre to Kingston, including ArtSound, a 24-hour community radio station and recording studios.
Depending on future developments and demand, Manuka Oval could bid for national cricket games such as Big Bash matches.
Economic Development Minister Andrew Barr said the aim was to make Manuka the ''best boutique venue in Australia''. A recent master plan identified a hoped-for seating capacity of 19,000 to 20,000, depending on demand.
Mr Barr said the Services Club would decide whether it wanted to move. There was no proposal to change the CZ6 leisure and accommodation zoning.
''A hotel or motel development on the site would be consistent with the land use zoning,'' he said.
Kingston-Barton Residents Group secretary Rebecca Scouller said residents accepted the oval and lights were a fact of life. ''But if they are going to expand it again by another 5000 [seats], a 25 per cent increase in capacity, they need to bring the local community along with them,'' she said.
ArtSound president Richard Scherer said members were thankful to be involved early in a feasibility study, but relocating sound proofing and other technical equipment and maintaining line-of-sight to transmitters would be a substantial move.
''If you are going to relocate, a lot of thought needs to go into it,'' he said. ''We have a substantial audience for a community radio station.''
Ms Scouller said residents wanted a point of contact on the lighting operation, the cost of lighting and more consultation on parking.
''The next big thing, I think, is if the government expands the oval out to 20,000 capacity - what that means for a heritage-listed suburb,'' she said. ''The street scape around the area is heritage-listed, so talk of carving up Telopea Park would make people irate.''
Mr Barr said the relocation of ArtSound and PhotoAccess was in the context of a Kingston arts precinct feasibility study expected to begin this month.
He said the two were advised that the timing for any potential relocation could be between two and five years, following funding being provided for the project.