Kingston shopping centre is languishing and in danger of dying unless a decision is made on a major redevelopment, according to retailers.
The ACT government says a long-awaited sale of a car park site for a proposed supermarket could happen by the end of this year.
The government granted the supermarket tenancy to Supabarn to inject more competition into the Canberra grocery market.
But retailers say inner-south shoppers go to Majura Park in the airport precinct, where Woolworths has opened its biggest supermarket in Australia to compete with Costco and where speciality tenants have moved, including a medical practice.
For years, developers have applied for a direct sale of the Eyre Street car park site opposite Green Square.
More recently, tenants in the Cusack's furniture block could not renew leases amid speculation Cusack's would be redeveloped in parallel with the Eyre Street car park.
These days, Ray White Commercial is advertising ground and upper-floor space in the former furniture block. Agent Andrew Smith said three fitness-related tenants had taken out long-term leases.
Second-hand book retailer Janet Kahler, who has been trading in Green Square for 19 years, said rezoning had initially caused excitement in the Cusack's furniture block.
''It closed and precious little has happened since,'' she said. ''The car park used to be full. Now you're lucky to have 10 cars in it.''
She said the government's consultation on a master plan in 2009 had been inexplicably put on backburner for years.
Mrs Kahler said Cusack's departure and the closing of the former Video Ezy shop made the death of Kingston's shopping centre a possibility but she still regarded it as the jewel in all of Canberra's suburbs.
A consortium of developers bought the former Ampol service station site adjoining the car park, which has been closed lately.
Lessee Robert Holmes said that was temporary and he expected to continue servicing cars there for several years.
While Supabarn's owners are property developers, they are unable to say whether they will develop the car park, as well as operate the supermarket.
Spokesman James Koundouris said the delay had definitely helped Woolworths gain a commercial advantage at the airport.
ACT Economic Development director-general David Dawes said the government was waiting for a planning variation to implement the master plan, before releasing the site. ''While the method of release is yet to be determined, it will be a competitive process, therefore either an auction or tender,'' he said.