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The Otago Regional Council has been trying to build a new head office for more than a decade.
In June 2016 a committee recommended a car park in Dowling St as the favoured site.
Dunedin City Council chief executive Sue Bidrose said the regional council this week made an offer on the site.
The city council would now contact its valuer and begin negotiations on that offer. It would "not be a quick process'', she said.
The regional council bought a larger waterfront piece of land in the Birch St/Kitchener St area for a new head office more than 10 years ago, but nothing eventuated.
Last year the regional council investigated selling the land to the city council for development. This would continue to be discussed, Dr Bidrose said.
Regional council chief executive Sarah Gardner said it was "early in negotiations'' for the site.
There were delays which meant the completion would be later than its March 2019 goal.
"The budget and timeline will be established once we have secured the site and consulted with the public.
The two councils were working together on parking, including the idea of joining forces on a multi-level car-park building.
In its draft long-term plan the regional council outlines a "building reserve'' which sets aside funding "for a new head office for the council in the future''.
In the most recent financial year, this reserve held $13.7million. It is expected to grow to $19.7 million by 2027-28.
The council has said it needs a new office as the current Stafford St site is too small and not fit for purpose.
The project has been pushed by the council for more than a decade, but has been halted by controversy and delays.