Developments for a new cafe at the Town Square (50 cent park) are forging ahead at a rapid speed with a planning application released this week.

And if the renovation of Five Star Supermarket pans out, the town's tally of coffee shops could exceed 10 - to include other businesses which sell coffee, the total reaches above 15.

Existing cafe owners in Katherine say they are concerned additional competition will add unneeded pressure, especially when the upcoming tourism season may be a fizzer.

Ryan Williams, the manager of the Coffee Club, said he is disappointed the council has plans to develop a taxpayer-funded opposition to already struggling cafes.

"Everyone is already concerned about the upcoming tourist season, we can already see numbers dropping off and when you add the bush fires and coronavirus to the mix it is unlikely anyone will be making a profit this year," he said.

"Everyone is already struggling, they have been for years.

"This just means less pie for us."

The new cafe at the Town Square is the latest development in the long-awaited CBD Revitalisation project, first announced in July, 2018.

With just $3 million left over, focus has been diverted from upgrading the whole main street to revamping the park on Katherine Terrace.

In addition to a shipping container kiosk with seating, Katherine is bracing for a recreational stage area, a shade structure, the addition of trees, a new public bathroom and a bike shelter.

More reading: Take a virtual walk through the new town square

And while the general consensus on upgrades to a relatively stagnant town remain positive, those in the industry are dismayed at the council's decision.

"Upgrading the park is a fabulous idea, it shows Katherine at its best for when people drive through town, however council should be supporting already established cafes," CEO of NT Friendship and Support, Stephanie Ransome said.

NT Friendship and Support opened Equalitea, a cafe supporting people with disabilities, just over a year ago and has relied heavily on community support since.

"I don't see the point in another cafe, it will only take away from The Finch, the Black Russian and us," she said.

"Upgrades to the park would have been good enough."

In direct competition location wise, the owner of The Finch Cafe, Chrissy Mckie, shares the same sentiments.

She was concerned Katherine would become over saturated with cafes.

"A cafe at Five Star is coming and then with this new one, that is a lot of competition when we already have a bunch of beautiful places that need local support," she said.

One of Katherine's most iconic tourism drawcards is also set to take a knock with the addition of a new cafe.

"With the pending coronavirus and bush fire crisis we feel very concerned about what will happen to us," the manager of the museum Simmone Croft said.

"We have no idea what the tourist season will look like, and it is likely to put a lot of pressure on those existing cafes that are already struggling."

Mrs Croft said while the general upgrades to the park were a step in the right direction, the addition of a cafe was not to the benefit of the whole town.

"I think it is great the council is taking initiative and doing something to make the main street nicer, but it would be better to hold off on establishing a cafe," she said.

The owners of the Black Russian and Maiden's Lane was contacted but were not available for comment.

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