The National Arboretum is set to become a permanent performance venue with plans to upgrade the amphitheatre and build a multi-functional performance stage.
The Midyear Budget Review has earmarked $210,000 for early planning work for the stage, as well as the proposed hotel for the national attraction.
A study and design package will look at the development of the stage at the bottom of the amphitheatre and a development strategy for the hotel.
The Midyear Budget Review says this will be in support of the National Arboretum Canberra Master Plan 2018, which sets out the benefits of enhanced visitor experiences and commercial opportunities.
The move comes soon after the release of a tender for 12 kilometres of new multi-use trails across the Arboretum.
The Government is moving to make the most of the key attraction, recognising its huge tourism potential as hundreds of thousands of visitors a year make the climb up the hill to take in the panoramic views and explore the grounds.
The Arboretum has been hosting one-off amphitheatre performances for years, and last year’s Anthems concert featuring the likes of John Farnham was a sellout.
The installation of a permanent, covered stage would increase the frequency of concerts and community events, and make them more commercially viable and secure.
It would also be an alternative to Stage 88 at Commonwealth Park.
The proposal for a boutique hotel has been in the works as far back as 2016, and last year Chief Minister Andrew Barr identified a 1.7-hectare site south of Dairy Farmers Hill with unsurpassed views.
Mr Barr had said the site would go to market this year and he hoped to attract international bidders.
The National Capital Authority will have to sign off on any proposal.