The Garsed Street property is a central part of Bendigo's architectural history.

Bendigo Foodshare wants to transform the factory into a hub to help it deal with the region's high demand for emergency food services.

The not-for-profit has asked the City of Greater Bendigo for help with the building's fit out.

City officers have recommended councillors earmark $140,000 for the project at Monday's council meeting.

The officers have told councillors the money comes from a fund that would have gone to Bendigo Foodshare to help it design and plan for a separate building in Golden Square.

The council set that money aside before Bendigo Foodshare secured a 20-year lease for the Garsed Street factory site.

The former Crystal Ice is so big that Bendigo Foodshare would not need to expand its Golden Square site, city officers said in a report lodged with councillors prior to Monday's meeting.

They said food insecurity was a problem for many Bendigo residents even before the pandemic triggered a 40 per cent increase in demand for emergency assistance.

"High levels of food insecurity were reflected in the 2019 Active Living Census with 9.6 per cent of the population not having enough food to eat at least once in the past 12 months," the officers wrote in their report.

That figure rose to 18.6 per cent of the population in some suburbs of the municipality.

Bendigo Foodshare estimates that fitting out Garsed Street would cost $1.4 million dollars.

The state government chipped in $400,000 earlier this year.

Mining company Kirkland Lake Gold has added another $300,000 through a philanthropic donation.

Bendigo Foodshare has launched a $700,000 fundraising campaign to get the remainder, city officers said in the report.

"Fit out of the Garsed Street warehouse will allow Bendigo Foodshare to double their capacity, provide cold and cool storage of food where appropriate and allow them to operate a social supermarket," they wrote.

"The social supermarket will be including a co-op style purchase, packdown and sale of bulk goods as well as giving away donated items and click and collect for the farmers market."

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