It comes after the Birmingham Gardens property won a reprieve last year when then Newcastle councillors vetoed a proposal for the civic authority to sell the site.

The cinema, housed in the community hall on Moore Street since the late 1940s, closed in October 2006 because the council-owned building was considered unsafe.

Community supporters lobbied to save the cinema.

Prominent Newcastle architect Brian Suters last year outlined to the council a plan to demolish the building and develop a $3.5 million three-storey multi-purpose centre.

It would contain a 100-seat cinema/lecture theatre, meeting rooms and 10 one-bedroom apartments for public and University of Newcastle use.

The council authorised a committee to further the plan, but imposed a six-month deadline which expired on June 19.

A report to tomorrow's council meeting suggests giving the committee another six months.

The report said the extra months would enable the committee to investigate matters such as finding project partners and gaining value for money from the site.

Friends of the Regal spokesman David Horkan said yesterday the council had focused in recent months on its budget and organisational restructure, which meant it had not been able to work through data from Friends of the Regal.

"We regard the request for an extension as an indication of faith in the project, and if it is granted we anticipate that the next step will be to incorporate our findings into the business plan that the committee is seeking to provide," he said.