The move comes after city planners threat-ened to pull the plug on the scheme.
The project to demolish and rebuild St Mary Street was first given permission nearly a year ago. But despite two amend-ments, work has still not begun.
Yesterday, developers Bellway Urban Renewal had to take the £12 million project back again to planners after financial problems forced changes.
But planners came close to throwing out the plans altogether after objecting to the reduction in number of shop fronts from eleven units to five, the reduction in amenity garden space and architectural alterations.
Bellway's scheme is pivotal to the whole £80 mil-lion regeneration of Southampton, which is part-funded by government cash and private money. Shop and market traders in St Mary Street are still objecting to the scheme, which would transform empty shops into housing.
Cafe owner Reno Abelo said the further reduction in shop space was an attempt to drive out prospective competition to the new £270 million West Quay shopping centre opening next year.
"This has been a farce from the beginning," he said.
Planners eventually agreed the scheme could be deferred for a further three weeks, while more amendments are made by developers.
Environment chief Paul Russell said: "We have to have mixed activity in the area, that was part of the brief.
"The company will have to come back with plans that enhance St Mary's, that aren't ordinary. Bellways said it couldn't afford the scheme as it was, but cost is nothing to do with a planning application."
The St Mary Street revamp had been due to begin in April, with the taking down of the canopy over Kingsland Market.
But regeneration boss Paul Jenks said the delay was not too traumatic, as the scheme was still waiting for government approval on its £5 million public funding. "The shop units were reduced because Bellway don't believe they have a realistic prospect of letting them," he said.
No one for the developers was available for comment.
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