The ACT Government is negotiating a land transfer deal to avoid a potential multimillion-dollar rent increase at Canberra Stadium.
The Government lease ends in 2024 but the peppercorn rent of 5c a year it pays to the stadium owner, the Australian Sports Commission, finishes on December 31.
If a new deal is not struck, the commission is entitled to market-based rent from January 1.
General manager of territory venues and events Neale Guthrie said the commission is ''looking for parcels of land on their boundaries out here at Bruce that would give them surety over their site so there is not more development encroaching''.
The area had become crowded with the expansion of the AIS coupled with the Gungahlin Drive extension on one side and housing going up at a rapid rate on the other side.
The commission is seeking about three football fields of undeveloped land and Mr Guthrie said it was concerned that increasing development in the area was putting the ACT in a strong negotiating position.
''They're looking to stop development at Braybrook Street which runs between Ginninderra Drive and Battye Street,'' Mr Guthrie said.
He said the concerns centred on room for future expansion and security risks.
Negotiations have been continuing for more than 12 months but a solution looks unlikely before the December 31 deadline.
''We are working on the interim solution of extending the lease just to get that cleared so that's out of the way,'' he said.
Commission executive officer Matt Miller said, ''We are going through a process and if this is not completed when current arrangements expire, we are open to extending existing conditions for a period.
''In this scenario, we would be committed to working with our partners to resolve the matter by the end of this financial year.''
Mr Guthrie said there were two options being considered.
''We either get a new lease on Canberra Stadium and there is an exchange which is quite a formal process ... we didn't talk numbers but it would be a lot of money and that would be offset by land swaps,'' he said.
This option would require Commonwealth support with the federal Minister for Finance, Lindsay Tanner, to make a decision about what would effectively be a land sale.
The other option is an extension of the current lease at peppercorn rates for an additional 60 years and the transfer of land from the ACT Government to the sports commission.
''Most of that decision is at board level so it's an easier decision to effect from the sport commission's perspective and the decision on our side is always a Government decision and that would still involve some parcels of land changing hands,'' Mr Guthrie said.
He said the Government was seeking an additional 60-year lease to ensure control over the asset.
The sports commission has a lease on the site until 2089.
But cabinet documents issued to The Canberra Times show that in 1999 the then Carnell government was offered the stadium for a purchase price of $11.25million.
It was to be paid in 40 quarterly instalments. It chose rent-free use of the stadium until December 31 and a lease on the stadium until 2024 for flexibility.