More than 80 inner-south business owners have signed a letter calling for the ACT government to reverse a decision to uphold the registration of a tree that stands in the way of redevelopment plans for the Capitol Cinema site.
The petition comes as the site's owner has confirmed she will challenge the decision to keep the tree on the protection register.
A letter from the Inner South Canberra Business Council says delays to the redevelopment would leave a rat- and pigeon-infested abandoned building in the centre of Manuka and that a new hotel would instead rejuvenate the shopping precinct.
"Already struggling small-business owners are pressing for the development to proceed," the letter says
The letter says the hotel development would inject tens of millions of dollars to the local economy and replace an "eyesore" that "will only cause fewer people to come to Manuka".
Manuel Notaras, who runs the Caphs Restaurant and Bar on Franklin Street, said landlords, the development and the government were being held hostage by a small, unrepresentative group of residents.
"We're all losers here, including the government," he said.
Mr Notaras said it was frustrating that the government had not consulted with business owners, who were crying out for more attention in the historic precinct.
"We used to be the Double Bay of Canberra and now it's a war zone," he said.
"As you can see, Manuka is dying and it costs us money. The longer it goes on, the longer it will cost us money. And we're the ones paying rent, rates and employing people."
John-Paul Romano, who runs the fledgling business council as part of his Pure charity group, said business owners had told him that the tree needed to go and a new hotel had to bring customers to the area in order for their businesses to survive.
Eighty-one businesses based in the inner south, including in Kingston and Deakin, had signed the letter, with more than half in the Manuka shopping precinct.
Sotiria Liangis, who first bought part of the site in 1989 after the Capitol Theatre was controversially demolished in 1980, welcomed the support of local businesses, whose owners could see the benefits of a new development on the site.
"And how prosperous that can be by having a five-star hotel, plus all the new cinemas, plus a lot of the commercial use on the ground level, plus the people working for the full year and a half to create that. Can you imagine how prosperous the shops will be?" she said.
Mrs Liangis said she had avoided petitions or the media before a decision was made on the tree because she had faith in the process.
The conservator of flora and fauna, Ian Walker, decided in May to keep the tree on the register, finding that there was no evidence of the tree's impact on services.
Mr Walker inspected the site in July 2018, where large tree roots can be seen breaching a clay sewerage pipe.
Mrs Liangis said on Thursday she would appeal the decision in the ACT Administrative and Civil Tribunal.
"I'm going to really fight for my rights. They cannot take my rights away, regardless of who they are. What I'm trying to do exactly what my crown lease allowed me to do, really simple actions," she said.
"And I don't ask for a favour from anybody."
Mrs Liangis said the tree was on her block, should not have been registered in the first place and was causing irrevocable and ongoing damage to the site.
The tree does not add to the landscaping of the street as it is within the boundaries of a privately owned block, she said.
Mrs Liangis, who worked alongside her husband, Angelo, in a Manuka shoe shop before launching Liangis Investments while still in her 20s, said she did not care what vocal local residents' groups thought of her and her plans.
"They don't even know me. I don't even know who they are. And you know what, I don't care who they are. I know who I am. I know what I do.
"I know what I have done for Canberra and especially Manuka, and I continue to do that. If they don't like me, too bad. I don't care, really," she said.
Mrs Liangis offered to plant 30 trees in another location in exchange for the protected tree being struck off the register, but she said the offer fell on deaf ears.
The tree was nominated to the register by a local resident in December 2010 and an initial assessment found the tree "provides aesthetic and environmental benefits" but was "not located in an ideal position".
Mrs Liangis bought the restaurant site next to the cinema building, where the tree is located, in 2015.
With roots throughout the prominent block, which fronts onto Canberra Avenue, there is no way to design around the tree, Mrs Liangis said.
ACT planning authorities made the same assessment in a submission to the process when the tree's registration was considered.
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In March, investigators from the ACT government's tree protection unit identified a drill hole in the tree's trunk but could not identify any poison.
The investigation was suspended in April without reaching a conclusion.
Mrs Liangis previously told The Canberra Times she called the police when an arborist identified the hole after she became concerned for the tree's health.
At the same time, local residents raised concerns about the tree's health, after leaves started to brown in a distinct pattern near the centre of the upper branches.