Developer Ross Deane announced Kmart had given up on a rezoning application for a Station Street site after not hearing from Wingecarribee Shire Council for a number of months.

He said he had decided to purchase a block on the south side of Victoria Street, and was confident they had dealt adequately with traffic management, heritage issues, aesthetics and parking.

All traffic would enter and exit the underground car park and off-street loading zone from Victoria Street, with the loading zone screened by colorbond gates and landscaping.

The building would be just under 5m high, Mr Deane said, adding he had tried hard to ensure the four or five specialty shops along Mittagong Road fitted into council's desired streetscape.

The land has several non-heritage listed buildings already on it, which Mr Deane said would be demolished to make way for the 6000 square metre complex.

The land was zoned 3a, an appropriate zoning for a discount department store, but Mr Deane was warned by Bowral Chamber of Commerce members council was attempting to change the zoning to residential.

"I know this council is trying to get a discount department store into Moss Vale, and in my opinion it is the worst decision they've ever made because it takes people out of Bowral, the retail hub of the Southern Highlands," Mr Deane said.

Other businesses said they were unhappy about the idea of a discount department store going in at the gateway to Bowral, but Mr Deane said he had taken great care to ensure the store would present well to the street.

Mr Deane reminded businesses there was an estimated $42 million spent by Southern Highlands shoppers in other centres each year.

He said perhaps half of these shoppers would stay in town if they had more choice of products in a lower price-range.

While more than half the chamber agreed with him and voted to support the development, in principle, there was some fervent opposition.

"You people come in and you spoil the town and you give us all these figures but I think it's terrible," Sue Brown said.

Barry Anstee said he was concerned the location of the store would fragment, rather than strengthen the business district.