Plans for a Wellington convention centre on a vacant site opposite Te Papa broke down because the landowner and developer could not agree on a price for the site.
The Wellington City Council announced the plan had been scrapped this morning.
When plans for $100 million centre, alongside a Hilton hotel, were unveiled in June, no mention was made of difficulties securing the site.
Sources said the council assumed developer Mark Dunajtschik and the landowner, Arrowtown-based company director Andrew Wall, would agree on a price.
The two had apparently tentatively agreed on the deal, but at the end of last week it became clear it would not proceed.
It was now proposed the facility would be built on the Interisland Wharf adjacent to Wellington Railway Station, which was owned by CentrePort.
But a source said the new site faced considerably more consent issues than Cable Street, where construction could have begun next month.
Wellington mayor Celia Wade-Brown said she supported the shift, but the idea needed to be investigated further and gain the approval of councillors.
Chamber of Commerce president John Milford said those involved should push on with the project as-soon-as-possible.