In a letter to local politicians, Griffith-Narrabundah Residents' Association president Leo Dobes said there was at least 17 vacant shops in the once-thriving inner-south area.

Littered streets, cracked footpaths and neglected laneways were other visible signs of a "decaying group centre".

Local business and traders groups have already sounded warnings over the state of Manuka, blaming ballooning commercial rates and a lack of ACT government investment for the area's decline.

In his letter, Mr Dobes puts forward a number of proposals which he said would go "a long way towards arresting the loss" of more shops.

Cracked and "shabby" footpaths could be repaired, he said, while the precinct's unattractive laneways could be cleaned up and reborn as "Melbourne-style" alleyways.

A shuttle bus service could be used to ferry politicians and staffers to Manuka during federal parliamentary sitting weeks, helping to boost trade, he said.

Mr Dobes told The Canberra Times that for years Manuka had been starved of government investment, which had contributed to its decline. The government's 2019-20 budget largely overlooked the inner-south precinct, aside from $800,000 to upgrade Manuka Pool.

"We fear that a part of Canberra's heritage will be lost. Not heritage in the traditional sense of the word, but in the cultural sense," Mr Dobes said.

Mr Dobes' letter also addressed the group's stance on the controversial Franklin Street tree which has stood in the way of developer Sotiria Liangis' long-held vision to redevelop Capitol Theatre with a hotel.

In May, the ACT conservator of flora and fauna Ian Walker ruled the London Plane would remain on the territory's tree register, meaning it cannot be axed, killed or significantly pruned.

The developer and her son, John Liangis, slammed community opposition to the redevelopment in the wake of Mr Walker's decision, before launching an appeal in the ACT Civil and Administrative tribunal.

Representative of both parties met on Monday for a directions hearing. Mediation is expected to be held in August.

In his letter, Mr Dobes said as compromise, the developer could redesign the planned five-star hotel complex to wrap around the London Plane.

But John-Paul Romano, who runs the Inner South Canberra Business Council, said the tree should not be allowed to block a development capable of breathing new life into the area.

More than 80 business owners last month signed the council's letter calling on the ACT government to overturn the decision to protect the tree.

Mr Romano this week while he did not agree with Mr Dobes' assessment that Manuka was in a "state of depressing decline", he acknowledged that the precinct was a shadow of what it was in the 1990s.

He said Manuka needed more private and government investment. He said the area would be boosted by the Morris Property Group's planned transformation of the nearby Stuart Flats with more than 400 apartments.

The ACT government was contacted for comment.