The ACT government doesn't know when construction work will re-start on the redevelopment of the old Red Hill public housing complex, after the discovery of asbestos brought the project to a halt more than four months ago.
Developer Stockland downed tools on the first stage of the 242-home estate in March, after asbestos was detected in pipes, pits and in topsoil across the site.
The developer is working with various government agencies on a plan to remediate the site, but there is no timeframe for when construction work will restart.
The setback has been a blow to local businesses, who were banking on trade from construction workers to support them until the estate's future residents moved in.
The discovery of the asbestos has raised questions about what knowledge the government had of contamination at the former public housing complex before it was sold to Stockland and Doma Group for $50.13 million in June 2018.
In response to questions from The Canberra Times, a spokeswoman for the Suburban Land Agency said the government tested the site before the sale, and authorised the removal of asbestos as demolition of the 144-unit complex got underway.
The site was deemed safe, allowing Stockland's contractors to start construction work.
The developer decided to shut down the site after more contamination was detected in March.
The spokeswoman did not respond directly to questions of how the site could be cleared of asbestos, only for the potentially-dangerous material to later be found.
She said the material detected at Red Hill was bonded-asbestos, which is not considered dangerous unless it is damaged.
However, the 52,000-square-metre block bounded by La Perouse Street, Monaro, Cygnet Crescents, has been shut off to the public as part of "strict control measures" to ensure that there are no health risk to the public or neighbouring properties, she said.
A spokeswoman for Stockland said it had completed a site remediation plan, which had been lodged with ACT government authorities.
The spokeswoman would not be drawn on whether it would ask the ACT government to offer compensation for lost time, saying on that it was "continuing to work with the authorities and the Suburban Land Agency to resolve the issue."
The Suburban Land Agency's spokeswoman also dodged questions about potential compensation.
"The ACT government and Stockland take matters concerning health and safety very seriously," she said.
"We are working together and are committed to providing a safe and healthy environment for the site workers and the surrounding Red Hill community."
Red Hill Butcher Shop owner Tony Pyke said the hold up had been frustrating for local businesses.
"When there was people living in the public housing units we got trade, and we were hearing that there may be as many as 100 workers on site," Mr Pyke said.
"It's going to be great when its all done, but it's pretty hard not knowing [when work will restart]."
Local Liberal member Elizabeth Lee said the government had questions to answer about the site's contamination, including when it was discovered and what needed to be done to remediate the area.