Waterford Council is looking for a new developer for the North Quays Regeneration Project.
The huge construction scheme has gone back on the market after the original developer, Falcon Real Estate, was unable to meet funding requirements.
The Council said it is fully committed to completing the project and Government sources are insisting that money is still on the table for the wider development which would link both sides of the city with a new bridge and replace Plunkett Station with a new transport hub.
But, while everyone remains hopeful, there is no doubt that a blow has been dealt to the ambitious development, which was to have included a 15-storey hotel and conference centre, twin blocks of offices, 300 apartments and an open public space.
Falcon had committed €400m to the project but was unable to meet the funding conditions by the deadline of May 15.