A $250 million plan by the NSW government to build a new Sydney Fish Market may deliver a windfall to an associate of the family of corrupt former Labor powerbroker Eddie Obeid.

Joe Elias, a friend of Mr Obeid's son Eddie Obeid jnr, is locked in negotiations with the Roads and Maritime Services (RMS) about surrendering a lease on land the government needs for the development.

Joe Elias is negotiating with the government over his business at Blackwattle Bay. Credit:Dallas Kilponen

Court documents show the RMS has been trying to evict Mr Elias' company Blackwattle Bay Marina from the site, terminate the lease and regain control.

A spokeswoman for the RMS told Fairfax Media the agency and Blackwattle Bay Marina "are in the final stages of positive negotiations for the Blackwattle Bay lease arrangements".