Councillors approved plans to look for commercial development opportunities at 5 Peel Street South and 28-32 Peel Street North at Wednesday night's council meeting as part of council's Bakery Hill and Bridge Mall Urban Renewal Plan.

The sites are currently being used as at-grade public car parks, but could be in line for future development as park of the plan.

The plan was adopted in October 2019 and stage one works include physical changes to the Bridge Mall and Little Bridge, Curtis and Grenville streets and a range of business and landowner support opportunities.

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Stage two looks to spur private investment in the CBD, including leveraging council-owned property as another opportunity.

According to the council officer report, an independent analysis which modeled the feasibility of development on council-owned land identified 5 Peel Street South, 28-32 Peel St North, and the supermarket precinct car park between Little Bridge and Dana Streets as opportunities.

The report said development on one or both of sites was feasible, could provide significant community benefit in accelerating the realisation of the Bakery Hill Urban Renewal Plan and could act as catalyst projects for further renewal.

The report said the sites could be used for premium inner-city housing, affordable housing, student accommodation, hotels or office space.

The report recommended council to seek a joint venture or other development proposal for the two parcels of land, with decisions on whether to proceed with development on the sites and how to be brought forward in a future report.

In making a submission to the item, the Bridge Mall Business Association said while it supported the renewal of the CBD and Bakery Hill precinct, the two sites contained more than 90 parking spaces between them and asked for the item to be deferred until consultation could be undertaken.

In moving the officer recommendation, south ward councillor Ben Taylor amended the motion to add an item that council continues to work with stakeholders including the BMBA.

Cr Taylor said the 5 Peel Street South site was especially important as one of the main entrances to the city and parking concerns would not be disregarded.

"We come straight through the roundabout at Bakery Hill, we've got a magnificent flag and heritage buildings and we end up with a car park. It's not a great look and we've looked at it for a long time to say how can we improve this area," he said.

"Here's an opportunity for council to put their money where their mouth is... we have a piece of land, let's go out and research options, go through a commercial process to see what opportunities are there and try to leverage the best outcome we can.

Central ward councillor Mark Harris said nothing was set in stone by the motion and any future development would come back to council.

"We want an open process to get the maximum amount of value we can and we'll look at everything on the table because there could be some gems in here and we do want to get this up and going, that's the imperative," he said.

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