The ACT government is moving to shore up the Outlet Centre at Fyshwick, which is at risk of collapse, by allowing a supermarket.
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The planning directorate has called for public comment on the plan until July 4, with the owner of the site wanting the new zone in place by August and a supermarket operating by the end of the year.
Supermarkets are not allowed in the Fyshwick industrial zone, but the government has taken up the Outlet Centre's push for a special new zone that will cover only the centre. The new "RZ5" zone would allow a 1000-square metre supermarket.
A report prepared by Elton Consulting for the Outlet Centre said unless a supermarket was allowed, shops would close and the centre itself might also be forced to close.
The government sold the block to DFO in 2005, but Elton said since its earliest days the shopping centre had struggled to find and retain tenants. It went into receivership four years ago.
"Whilst the direct factory outlet component of the centre is trading at a reasonable level the homemaker hub is continuing to struggle to find and retain tenants, particularly in light of the recent opening of IKEA Canberra," the Elton report says.
"Vacancies are expected to increase sharply in the near term in the homemaker hub with a significant number of tenancies (14,118 m2 ) either with leases expiring within the next six to 12 months or on holdover (i.e. lease has expired)."
More than 30 per cent of the tenancies were at risk, most refusing to recommit "without a clear strategy to underpin the centre's attraction", it said.
If tenancies weren't renewed, the centre, which employed about 850 people including casuals, might itself be forced to close.
"This will send a negative message to the community about the strength of the ACT economy and also potentially result in a derelict building on a major avenue in Canberra."
The closest supermarkets are Narrabundah, (960 sq m) and Griffith (800 sq m), with the closest big supermarket at Manuka, where Coles has a 3480 sq m supermarket.
The Elton report said a Fyshwick supermarket was expected to make sales of $11.6 million, but the impact on nearby supermarkets would be negligible. About $2 million of sales would come from those supermarkets – $500,000 from Narrabundah, $300,000 from Griffith, $200,000 from the Red Hill Friendly Grocer, and $1 million from the Manuka Coles.
More, about $3.6 million, would come from "non-supermarket traders", including small food stores, fresh food operators, markets, freestanding liquor stores. This category presumably includes the Fyshwick Markets.
The supermarket bid comes from Balmain Asset Management, after receivers were appointed by Direct Factory Outlets in 2012.
Also in the Territory Plan change released this week, the government wants to allow mobile telephone equipment in the urban open space zone. The government says mobile phone infrastructure has historically been placed in the zone, but the Territory Plan prohibits it.
"Allowing 'communications facility' in the public open space, which includes hills and ridges, will provide increased opportunities for mobile phone coverage. However, any proposal would need to be assessed on its appropriateness for the area and the surrounding environment, including consideration of any nearby residential areas," chief planning executive Dorte Ekelund said.
Road access to narrow blocks is also being changed. When a block is less than eight metres wide and an address faces a rear lane, current rules ban car access where roads carry more than 3000 vehicles a day. The new rule removes the vehicle number, instead banning access to "major collector roads".
