Kiama Council's Akuna Street car park has long been identified as the council's preferred location for a second supermarket in Kiama.

In recent years Kiama Council has spent almost $7 million buying up property surrounding the car park and the council has prepared concept plans for what a proposed development on the site could look like.

Cr Petschler said he was not in a position to name the potential key tenant at this stage due to commercial in-confidence, however he said an agreement had been reached subject to some "minor issues" such as staff car parking.

"I'm confident the issues can be addressed ... once that is sorted the site will be offered for sale with the commitment from the key tenant," Cr Petschler said.

The sale would include the former Weston & Co Publishing's property in Shoalhaven Street, but not involve the recently purchased Mitre 10 site, which Cr Petschler said was "a longer term strategic site".

"We invested funds held in the reserve [for the Mitre 10 site]. Eventually those funds will be put back from the site into the reserve."

Earlier this year councillor Andrew Sloan called for more community consultation over the future of the Akuna Street precinct.

Cr Sloan said money had been set aside in the new financial year for a master plan for the area.

He said while a master plan would not impact on the concept plan for the proposed development, which includes a 2000-square-metre supermarket, 14 speciality shops and 30 residential, there would still be opportunities for the two to work together.

"The master plan would be for the whole area and would address issues of concern such as parking," Cr Sloan said. "The councillors have lots of ideas and it will be good to get some community input."