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A spokeswoman for the company said a resource consent application had just been lodged, or was about to be lodged, with the Dunedin City Council.
However, it was too early to say when the work would begin, she said.
The development came closer to fruition at the end of last week when the former Royal Tavern on the corner of Main South Rd and Jefcott St was demolished.
Progressive Enterprises has been in talks with the Dunedin City Council for the past two years with a view to developing a Fresh Choice supermarket on land between Main South Rd and Shand St.
The site includes the former Royal Tavern as well as land next to Green Island Memorial Park and a block of council-owned flats.
The spokeswoman said the company had also been in discussions with Green Island supermarket operator John Moyle, and if resource consent was granted, the plan was for him to close his Moyle's Supervalue Supermarket on the opposite side of Main South Rd and the new supermarket would be branded Moyle's Fresh Choice.
When contacted at the weekend, Mr Moyle said he had not yet heard if the development was officially going ahead.
He declined to comment further.
The ODT understands the supermarket, if built, would cost millions and be similar in size to the Fresh Choice supermarket in Highgate.