The valuation the club submitted as part of its application to deconcessionalise the land claimed the prominent block, next to Manuka Oval and opposite the Manuka shops, was worth just $250,000.

But the Griffith-Narrabundah Residents' Association, Kingston and Barton Residents Group, Friends of Manuka Pool and the Inner South Canberra Community Council have lodged submissions to the planning authority challenging that figure.

When clubs or other community groups apply to deconcessionalise land, they must submit a valuation of the block, which is then used to calculate a "pay-out amount", a dollar figure the applicant must pay the government to deconcessionalise the land.

The Colliers International valuation would mean, if the government accepted the figure as accurate, that the club would need to pay only $125,000 to deconcessionalise the block to make way for a sale or potential $45 million redevelopment on site.

But the residents groups say the valuation, if accurate, would mean the block was worth only about $100 a square metre — a far cry from the $8.4 million paid at auction for the nearby block now housing the East Hotel.

Inner South Canberra Community Council president Marea Fatseas said the figure was "laughable" and she was amazed anyone could suggest "straight-faced" that the 2468 sq m block, zoned for leisure and accommodation [CZ6] would be worth only $250,000.

"The valuation makes me think what would the mums and dads out there struggling to try to buy a home in Canberra think about the block in Manuka being worth only $250,000, when they can’t get a block of land for a house for that in the outer suburbs," she said.

Griffith Narrabundah Community Association committee member Wayne Arthur said his group was simply pointing out that if the government took the valuation at face value, taxpayers would be receiving "a whole lot less revenue" than if a real market value was applied.

"We've taken a fairly narrow approach in our submission as we think that basically this current application doesn't meet the criteria for the public interest test, so the minister should not approve it," he said.

The Griffith-Narrabundah Residents' Association submission claimed the valuation was "simply not credible" and assuming the block sold for the same price per square metre as the East Hotel block did, it would be worth $7.129 million "or more than 28 times the value as assessed by Colliers".

However, Planning Minister Mick Gentleman said irrespective of the Colliers valuation, the government's valuation office would complete a "critical assessment", which he described as a "thorough and robust process" to find an accurate current and market value for the block.

He had also not received a brief from the planning authority on the application, and could not decide whether it would be in the public interest, or not, until he had a chance to consider the brief.

Club president Mike Kinniburgh said he was not an expert in property valuation, and that is why the club sought a "professional, independent valuation" and he had no reason to think why it would be incorrect.

"We just got an independent valuer and there’s lists of acceptable valuers to the government, I wouldn’t have even known who the valuer was that did it," he said.

The other residents groups also questioned why the application should be allowed to proceed, in the absence of a promised master plan for the area, as well as a community panel Chief Minister Andrew Barr promised before the 2016 election.

She said the proposal was one in a series of "ad hoc proposals" the government was considering separately that would affect the wider area, stretching from the Manuka shops, past the oval and Telopea Park and down to Kingston Foreshore.

"This area's got about a dozen heritage-listed sites, but what the government is doing is allowing a site-by-site approach to development without any thought about the whole precinct and how it should be planned," she said.

Despite the community concerns, Mr Gentleman would not commit to either pausing the club's application, or to speeding up the plans for a community panel and new master plan for the area.

He reiterated the government's previous comments the community panel would not be convened until at least next year.

Despite concerns a broader plan was needed to encompass the oval, Manuka and Kingston shops and the Kingston Foreshore, the prospect seems unlikely to eventuate, with Mr Gentleman saying only that a master plan for the Manuka Group Centre was completed in 2013.