With the amount of accommodation under development in the area and proposals for more - including a multimillion-dollar floating luxury hotel proposed by the Oamaru Licensing Trust - the Waitaki District Council was in "no rush" to develop the site, he said.
"We don't want to lose the essential character of it [the harbour]," Mr Kircher said.
"We don't want wall-to-wall development around the harbour. Back from the harbour, you can have more. It is being selective about where you do it, it's also about being selective about where you have not only developed space, but open space."
The council entertained "a couple of good options" for the Esplanade Rd site after calling for expressions of interest for two Oamaru Harbour sites in August last year, but nothing that "ticked all the boxes".
"We've put those on hold," he said.
"We're focusing on site 2 [Tyne St] and obviously what else is happening around the district."
The proposal for a 40m by 9m, 25-room, three-level, four-and-a-half-star hotel floating in the harbour, unveiled this week by the licensing trust, would add to the higher-end accommodation Oamaru needed and the council did not want to swamp the market.
"We don't want to have that boom-and-bust situation, where we get a lot of development and it takes a while for the market to catch up," Mr Kircher said.
The council's long-term plan approved last month allocated $50,000 for the development of a master plan for Oamaru Harbour and the town's historic area.
North Otago Yacht And Powerboat Club commodore Kevin Murdoch said he was taking a cautious approach to the trust's proposal.
"We have to look at everything that comes along. We can't hold back the area," he said.
"I'm not against it, but at the same time we're wary of development down there and how it will impact on us.
"The thing that worries me is will the harbour users ... will we be approached to have any input in it?"
Compared with the roughly 30 10m to 12m boats moored in the harbour, the proposed hotel would likely stand out.
Waitaki Tourism Association board member Ole Wallis said he did not have a "firm opinion" about the proposal.
"We know Oamaru is in need of more beds at the peak of the season. However, this is not an all-year-round case."
The effect of it on wildlife and the landscape "would be something we all should also be concerned about", he said.
Oamaru Blue Penguin Colony research scientist Dr Philippa Agnew said she did not believe the proposed floating hotel would effect the harbour's penguins.
Trust general manager Cathy Maaka said the developers were not tied to a design at this stage, but were committed to a four and a-half star rating.
