Council bosses are hoping to resolve a dispute over plans for a new £1 million cultural quarter in Perth city centre without resorting to controversial compulsory purchase powers.
A vision for the Mill Street area has been unveiled to the public as part of an ambitious development project to attract more visitors, businesses and future investment.
Perth and Kinross Council wants to enhance the central area to complement recent additions, including the new Premier Inn hotel and the forthcoming relaunch of Perth Theatre.
The local authority hopes to provide space suitable for events, markets and outdoor dining.
At a meeting of the full council, head of planning David Littlejohn admitted that negotiations to take over a warehouse owned by James Banks and Son (Banks of Perth) had caused delays.
He said: “The timescale has broadened out because when the project started we had some fairly positive discussions with all of the landowners, including the Banks family.
“As time went on, it became clear that their aspiration in terms of price for the building was too far apart from what the reasonable value of that building would be.”
He added: “We have had conversations through agents (representing the Banks) to try and come up with a compromise where the Banks family can share some future value of the site once it is developed. Those discussions are ongoing.”
Mr Littlejohn said that a compulsory purchase order was “not an action anybody wishes to pursue if it can be avoided”.
Councillors agreed to acquire land and rights, either by negotiation or compulsory purchase.
Rhona Banks of Banks of Perth said the warehouse is crucial to the future of the 184-year-old business.
She declined to comment on ongoing negotiations.
Council leader Ian Miller said: “This exercise, along with the redevelopment of Perth Theatre, will hugely improve the vista of the street.
“That is so important to Perth as the Mill Street area has the potential to become one of the best cultural hubs in the country.”
He added: “I would stress that negotiations with owners will continue and I hope that compulsory purchase will not be necessary.”