Council will decide which way traffic will flow through the Bridge Mall at its next meeting, a move welcomed by many traders.
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While not everyone is a fan of the proposal, the news that work was progressing is a "step in the right direction", one trader said.
The proposal to be recommended to council officers involves opening the mall from Sturt Street with a single lane to Peel Street, keeping trees and the playground in place.
This would encourage more locals to utilise the area, according to council officers - council has allocated $15 million over three years to realise the project.
A concept video for the proposal shows a one-way connection from Sturt Street, with Grenville Street blocked south-bound from Curtis Street to Little Bridge Street to extend the median, making the area safer for pedestrians.
The street could also be blocked with bollards to allow markets and other events to occur.
An alternative option, with traffic heading the opposite, west-ward direction, will also be suggested.
Faull's Shoes general manager David Maloney said the designs have provided some "good conceptual ideas" to move forward with.
"For the first time, we feel, all the emotion's been taken out and the experts have put forward their recommendation," he said.
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"This is addressing the new developments (to the west) and sensibly they're saying the entrance should be coming from the west, to make it a much more accessible and viable option for us."
Messer and Opie's Tracy Govan said the proposal was the beginning of a "new era" for the troubled pedestrian mall.
"There's going to be yes and no for (opening it to traffic) either way, there's going to be a lot of controversy over it of course, but I support whichever way it happens at the end of the day," she said.
"Stalemates are no good, we need to do something."
This was echoed by Commerce Ballarat chief executive Jodie Gillett, who added opening the street could attract more businesses to open at night, potentially including hospitality outlets.
"It really is critical for the CBD that we have a more vibrant area down there," she said.
"We've got some fantastic businesses in the mall, and if we can turn it back and get more activity, more people through there, there's no doubt that will stimulate new businesses, restaurants and cafes to open in that area."
"There's no way restaurants and cafes would look to move into that space while it's still a mall - it's not vibrant at night, and the road will certainly activate that."
Some traders The Courier spoke to said they were still not convinced opening the road to traffic was the correct idea - one trader, who asked to remain anonymous, said they did not see how it would benefit their business if it became a thoroughfare.
City of Ballarat chief executive Evan King said this would not be the case - instead, the $15 million project would be a "catalyst" to attract new businesses to the area.
"We believe that will create that incentive for people to invest here and feel like it's a good investment, and people will be here to make those businesses viable," he said.
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The upgrade is a key part of council's plans to redevelop Bakery Hill - Mr King said council approved the proposal next week, the project could go out to tender in June, with a contractor appointed by the end of the year.
"We want a thriving, active, healthy, safe place for Ballarat people to come to - we've got great parking on either side of the Bridge Mall, if we can get it opened up and get people flowing through, dining on the sides of the street, we believe this can become a jewel in the Ballarat crown," he said, adding the proposal had the support of the Bridge Mall Traders Association.
"I've not had anyone say leave it alone as it is, everyone wants it activated and wants council to get on and make it happen."
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