Kaufland is pushing ahead with plans to bring a new supermarket and 100 jobs to Warrnambool's east.
A timeline for the development is still to be decided, but the company has made a late submission to a city council planning scheme amendment which will soon come before a state government-appointed panel.
Some of the land earmarked for the supermarket on Raglan Parade is currently zoned residential - and the council's future vision for that land in its Eastern Activity Centre Structure Plan amendment was to keep it as a housing precinct.
But that will now be decided by the state government planning panel which will conduct hearings in December.
Councillors were told that the supermarket developer wanted flexibility in the structure plan to facilitate a major new commercial premises.
A unanimous vote of councillors will allow the supermarket to have its say at the planning panel hearings.
Cr Michael Neoh said he thought the supermarket was a good project but pointed out that the state government would probably do most of the planning and would probably override council.
Cr Peter Hulin said the opportunity to have such a multinational company as Kaufland to develop in Warrnambool would bring employment to the city.
"It's something that will put pressure on other supermarkets to compete with price and value and quality," he said.
The Standard revealed in June Kaufland was scouting sites across Warrnambool, and in August said it would seek approval for a new supermarket at 69-83 Raglan Parade.
The company has described itself as a "one-stop" destination supermarket, saying its 4000-square-metre store will focus on fresh produce.
It will offer a bakery and fresh hall, as well as a number of independent local businesses, such as cafes, smaller food outlets or pharmacies.
Kaufland Australia said it was committed to long-term, sustainable investment across Victoria.
"We want to create opportunities for local businesses, new jobs, and deliver a world-class shopping experience to Warrnambool," it said.
"Up to 100 new local jobs will be created here by the proposed development."
The company said there would be more jobs created during the construction phase.
"We look forward to working with the community, Warrnambool City Council and other key stakeholders during the process," it said.
A letter to the council from Kaufland revealed the company was interested in the entire parcel of land at number 69, which it identified as being the location of a motel, and land with frontage to Raglan Parade between number 69 and the proposed major traffic light intersection at Glynbeundy Street near Harvey Norman.
However, a spokesperson for Kaufland said plans for the site were still being developed.
Have you signed up to The Standard's daily newsletter and breaking news emails? You can register below and make sure you are up to date with everything that's happening in the south-west.