The City of Greater Bendigo has "noted the public's interest" in a planning application lodged with its planning department but wants to underscore that no decision has been made yet.

"It will be reviewed in the new year and like all planning permit applications will consider issues such as heritage, design and car parking," statutory planning manager Ross Douglas said.

The proposal calls for a six storey, 110 room hotel at the site of the vacant Thomas Jewellers shop.

The hotel would not add any parking in the city centre, according to Bendigo Hotel Investments' proposal.

Instead, hotel guests and 53 workers would mostly rely on on-street parking, public transport, cycling or walking.

"We are satisfied that traffic generated by the proposal can be absorbed by the surrounding road network and intersections without any material impacts," traffic engineers advising BHI said in the planning application.

A planning expert who has advised councils like Bendigo's last week told the Bendigo Advertiser the number of parks created for the development should be a commercial decision for the hotel owners and that shopfront parking is limiting city centre trade.

Mr Douglas stressed that the expert is not a staff member in the planning department.

"The city is committed to supporting business activity in the city centre and to ensuring the best possible accessibility (by car, on foot or by public transport) for residents, workers and visitors," he said.

The hotel proposal has been lodged as the council considers dropping minimum parking requirements for new developments in the city centre.

The parking strategy would defer all decisions on parking to the market, putting the onus on developers to create buildings they are confident can get tenants or be sold within 30 years being finished.

"They (developers) are the ones that need to justify their proposals to financiers for a building to be constructed," the report stated.

"It therefore makes sense that they only provide the parking that is needed for a development to work, not what an arbitrary figure set many years ago by bureaucrats has estimated."

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The draft report recommends "three big actions" including dropping minimum parking requirements in the city centre, completing investigations into a new muliti-deck car park and bringing in "dynamic" pricing for paid spaces to better juggle supply and demand.

Public submissions for the draft plan closed in October.

It is yet to be voted on by councillors, or adopted into the planning scheme.

The building earmarked for the hotel is heritage listed because of its links with 19th century shopping arcade The Beehive Building.

A heritage assessment on behalf of applicants BHI found most of the area fronting Hargreaves Mall were added on to the building in the 20th century and are of less cultural and historic value than that on Pall Mall.