Work Safety Commissioner Greg Jones said it appeared the Fluffy asbestos might have migrated to at least the neighbouring block, and testing was now being extended further along the street.

The news puts a question mark over the future of the heritage listing row of buildings, with Mr Jones saying decisions about cleaning or demolition would be made after asbestos assessors Robsons had finished their report next week.

"There's certainly potential short or medium-term remediation possible with appropriate cleaning by a qualified hygienist and asbestos management plans," he said, speaking at a parliamentary hearing. "But as a long-term situation, if there's loose-fill asbestos in a building, then demolition is the only long-term solution."

The dangerous loose asbestos insulation is still in situ in the ceiling of the first-floor flat, above Edgar's Inn on the corner of the Ainslie shops. A prohibition notice has prevented entry to the flat since late in 2014.

To date, it was assumed that because the Edgar's building is separated from the neighbouring building by brick walls, the asbestos would be confined to the corner building. But Mr Jones said it "appears it might have migrated to at least the neighbouring block".

"We're very confident that the testing will completely reveal where the asbestos has found its way," he said. "While we're still waiting on the final report, our understanding at this stage is that it's largely confined to roof spaces of a number of the units. But we're still waiting on the final report for confirmation of that."

Mr Jones said four businesses - the southern half of the shops - had been extensively tested to date. He was confident the businesses were safe.

A newsagent operates directly beside Edgar's and a laundrette beside that. A therapeutic massage businesses operates from the first floor above the ground-floor businesses, beside the flat that was hit with the prohibition notice.

The owner of the massage business said on Tuesday she had been told the premises were safe.

"As far as we know everything is perfectly safe and there's no risk to anyone," she said.

The owner of the newsagency likewise she she had been told her business was safe.

The corner building housing Edgar's and the empty flat is owned by Jeff Darwin, who said yesterday he had spoken with Worksafe on Monday but had not been told about results of testing, and still had "no idea what the way forward is".

The buildings along the rest of the street are owned by Manuel Xyrakis, owner of the Ainslie IGA supermarket. Mr Xyrakis said the buildings south of the laneway had been extensively tested, and testing was now moving to the buildings north of the laneway, including above the supermarket.

He had commissioned asbestos testing in 2012 and been given the all clear, he said, disappointed to hear of the possible spread.

"That upsets me if that is the case," he said. "I'd like to find out how or why, and what has to be done about it."

The Ainslie shops are heritage listed and two of the buildings have tarpaulins covering the roofs after problems with water entering through the tiles - which Mr Xyrakis has been unable to successfully fix because he says heritage authorities won't allow him to replace the tiles with metal.

Mr Fluffy loose asbestos insulation was removed from the ceilings of just over 1000 Canberra homes in the late 1980s and early 1990s in a commonwealth clean-up program. But the discovery that fibres remained in wall spaces and under-floor cavities of the homes led to the ACT government's decision in 2014 to buy and demolish all 1022 homes.

In the case of the Ainslie shops, the insulation was never removed in the commonwealth clean-up because it was a commercial building. As a result, the original insulation remains in situ, with little action until now to deal with it, other than the prohibition notice in 2014.