The ACT government is seeking public feedback on a variation that would rezone two blocks from industrial to commercial with a capacity for residential.

Developer Molonglo Group has proposed to expand its Dairy Road development, which is currently refurbished warehouses and includes businesses such as Blochaus, Pickles Auctions and Capital Brewing Co.

The ACT's planning and land authority opened consultation for the draft territory plan variation after Molonglo submitted a planning report.

Alongside the proposed residential, Molonglo has proposed 38,224 square metres of non-retail commercial development and 16,315 square metres of community space, according to the developer's planning report. The development would be built over 10 to 15 years.

A variation to the territory plan would allow for building heights to be up to eight storeys but only four-storey buildings would be allowed in areas adjacent to the Jerrabomberra Wetlands.

The residential would be located on the south-western part of the site and would house about 2000 people. Molonglo said there would be a range of housing options, with a target of 10 per cent for affordable housing.

"Molonglo is proposing a genuinely diverse mix of dwelling types, including communal living, build to rent, artist studios, townhouses and the more typical apartment living. Molonglo is also committed to the inclusion of affordable housing schemes," the planning paper said.

The New Acton developers purchased the 14.5 hectare block from the Commonwealth in 2002.

The site is bounded by Monaro Highway, Dairy Road, the Fyshwick Sewerage Treatment Plant, the Jerrabomberra Wetlands Nature Reserve and the Canberra to Sydney railway corridor.

Its interface with the treatment plant and a high pressure gas pipeline in the Monaro Highway road reserve would be "the provision of defined exclusion areas", certain uses would not be allowed in this zone.

As well, part of another block would be rezoned from industrial to an open landscape zone to act as a buffer between the Jerrabomberra Wetlands and the development.

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As part of the draft variation, ACTPLA was required to consult with other government agencies and according the the draft territory plan papers the Conservator of Flora and Fauna expressed concerns about potential impacts on the Jerrabomberra Wetlands.

"Whilst it may be within the existing the draft variation does not adequately address potential impacts on the adjacent JWNR," the comments said.

In its response, the Planning and Land Authority said the conservator had been advised discussions would be held with Molonglo about future arrangements with the Wetlands Trust.

The Environment Protection Authority said it was concerned the site had not been adequately assessed from a contamination perspective.

The ACT Planning and Land Authority said in its response Molonglo was in the process of completing a contamination assessment for the site.