The proposed sale of the Canberra South Motor Park has been scuttled after the buyer's offer was withdrawn, Housing Minister Yvette Berry told the Legislative Assembly on Thursday.
In November, residents of the Fyshwick site expressed concerns their community was at risk, as retirement village company Ingenia Communities looked to finalise a $14.7 million acquisition of the park in late-2014.
The park is currently home to about 600 residents and is owned by a private partnership including members of two families; Phillips and Scheinberg.
Many residents have lived in the area for as long as 20 years and live on low incomes. Public holiday accommodation is also offered on site.
Documents prepared last year by Ingenia for corporate investors said the Canberra Avenue park presented a "significant opportunity for repositioning and development" and could be reworked to include as many as 150 additional living spaces.
Ingenia's annual general meeting was told the park's purchase would deliver returns of about 8 per cent. It is believed to deliver annual profits of around $1 million in its present form.
Ms Berry announced the sale was off in a statement about public housing in the ACT. She said the park represented a "small but important part of the housing continuum in Canberra."
"Recent commercial interest in the sale of the site had led some residents to raise concerns about their future at the site," Ms Berry said.
"I can inform the Assembly that the government has now received advice that the offer for sale has been formally withdrawn. It should also be noted that in all discussions about the future of the site, the government has clearly identified the long term future of residents as a primary consideration."
A spokeswoman for Ingenia Communities said the company withdrew its offer after issues identified in the due diligence process could not be resolved. The company "remains interested in the Canberra market."
Manager Jim Garvin said co-owner Rob Phillips was not available for comment but that the park remained on the market after the sale fell through.
"It was a decision made by the buyers and we're not quite sure what happened. They made a decision and stated issues that arose during the due diligence but that's as much as we know.
"The residents are quite happy and relieved," Mr Garvin said. "We are looking at plans and discussing things for the long-term future of the park."
Opposition housing spokeswoman Nicole Lawder first raised concerns about the sale in the Legislative Assembly last year.
"Residents would be relieved to hear this latest news," Ms Lawder said.
"They were very concerned that a sale might mean they would be evicted. Housing affordability is a major issue in the ACT along with public housing at capacity levels"
Ingenia has 58 villages across Australia, with more than 3,000 residents living in a range of accommodation options. The company owns 27 sites in New South Wales, catering to holiday makers, retirees and permanent residents.
Residents last year complained to management about the lack of information on the possible sale, while some were concerned only four existing residences will be allowed to remain on the site.
Ms Berry told the Assembly that in 2013-14, 22,605 Canberrans lived in public housing across 10,724 tenancies.
In the same period more than 97 per cent of new housing allocations were to residents in priority and high needs housing categories.
About one in five households had a main tenant aged 65-years or older and 68 per cent of single tenant households were women 65-years or older.
About a quarter of all households were single parent households and 85 per cent were headed by women.
At the end of June 2014, there were 780 Aboriginal and Torres Strait Islander public housing tenancies, housing 1,643 residents.