Kensington Market looks like it's going to stay Walmart free thanks to a deal struck between city councillors Mike Layton and Adam Vaughan and developer Riocan, The Globe and Mail reports. The controversial big box store planned for Bathurst Street that would have housed the retailer is being significantly scaled back, cutting the retail space by more than half.

The back-and-forth over the Kensington Walmart, which would have been built on the site of the former Kromer Radio building, has been going on for more than two years and attracted widespread criticism from local residents.

Riocan fought for its proposal at Toronto's committee of adjustment and the Ontario Municipal Board. In July 2013, the city issued a year-long moratorium on all new stores on Bathurst between College and Queen streets, putting the brakes on the project.

According to The Globe and Mail, Vaugan and Layton outlined the revised concept at a local stakeholders meeting earlier this evening. The new design for the store will have 4,180 square metres of retail space, down from 8,825 sq. m. There will be office space on the upper floors and the building will be set back further from Bathurst St.

But that doesn't mean Walmart is definitely backing out. In a slightly cryptic remark to the newspaper, Ed Sonshine, chief executive officer of RioCan, said the deal will allow the retailer to "basically walk away" from the deal.

The full proposal will be unveiled later this month and will still need to pass city council.

Chris Bateman is a staff writer at blogTO. Follow him on Twitter at @chrisbateman.

Image: Turner Fleischer Architects