A future expansion of the northside suburb of Lawson is in doubt as the government has not been able to sell the land that allows for almost 1000 properties.
The failure to sell has been blamed on an electricity substation on the site, which Suburban Land Agency chief executive John Dietz said made the site technically "very challenging".
"In very broad brush strokes there is an electricity subzone that is sitting within the development footprint, which is both a technical challenge and a planning challenge," he said.
In an estimates hearing, Mr Dietz said the cost to implement a design solution for the subzone had proved to be too significant.
The agency is exploring how it can take the land to the market again. Mr Dietz flagged that the government could possibly undertake a joint venture.
"Perhaps by sharing risk between different areas, [we'll] have a better ability to mitigate these risks," he said.
"Through a joint venture it may be that we can find a solution."
The government first approached the market for expressions of interest for the 43-hectare site, dubbed "Lawson 2", off Lake Ginninderra, in 2018.
About 940 dwellings were slated for the site, with zoning for high and medium density residential.
There is also zoning for commercial, mixed-use and community facilities.
At the time, Mr Dietz said the agency expected "significant interest" in the land.
Lawson 2 would not include the proposed 570-home Defence Housing Australia estate. This would be to the north of the existing suburb.
Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content: