The cost of repairing Dunedin's old buildings has the Property Council calling on city planners to take a step back before proclaiming a building as heritage-listed.

The city's central business district is known for its heritage buildings, including its historic courthouse. Tourists line the footpaths to experience the buildings' grand facades.

The Dunedin City Council has been working with commercial property owners to restore once-grand CBD buildings fallen into disrepair, with dozens restored in recent years.

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But the Property Council says some older buildings in Dunedin are simply past their use-by date and cannot be salvaged.

It has presented a submission to the city council as it undertakes public hearings for its Second Generation District Plan.

Property Council spokesman Alex Voutratzis said the city council had been putting city-wide heritage rules in place first and expecting owners to put their case forward later.

"Let's have a council that wants to engage with commercial property owners at the beginning and work in partnership to get rules and flexibility in those rules, because every single building is incredibly different," he said.

"You can't have a one-size-fits-all approach."

Mr Voutratzis said in the past some owners had locked up their buildings and walked away, unable to meet the council's demands.

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In order to market Dunedin as a city ripe for business investment, its CBD buildings needed to be functional and up-to-scratch, which in some cases meant making way for new builds, he said.

"A functioning city should be in a constant state of change. You only have to look at Auckland CBD where they're demolishing shopping malls or they're demolishing buildings and replacing them.

"But that's the idea of a city, a city shouldn't be stagnant."

Southern Heritage Trust trustee Jo Galer said she understood the Property Council's concerns, but its attitude was 20 years out of date.

"People have to realise the value that we are now seeing in our heritage buildings as they are slowly renovated and turned into economic units once again.

"I would hope that perhaps those days are gone where we look at buildings as being an eyesore or just a nuisance that only require demolition."

The Dunedin City Council said it was not able to provide a response while district plan hearings were under way.