Chief Minister Alf Cannan says the government is working with a developer over a project on North Quay in Douglas.
The owner of the Newson's site said they wouldn't invest in the Island anymore after being refused to demolish the shop - which lies in a conservation area.
In Tynwald, Mr Cannan was asked about the site by Central Douglas MHK Chris Thomas.
Mr Cannan said the government had spoken to the developer about the scheme:
Government wants your say on organ donations
The government is to bring in new laws about organ donations, and it wants your say.
Controlled burn leads to Fire Service callout
Firefighters are reminding people to prepare properly when carrying out controlled burns, after a blaze spread in the west of the Island.
Lord Street development 'still progressing'
The owner of the former Lord Street bus station says it's still hoping to press ahead with redevelopment plans.
More Braddan roadworks announced this month
The Department of Infrastructure says Braddan Bridge will be one-way as it carries out work later this month.
Poled pussy tale gets a happy ending!
Manx Utilities says it's given the saga of a cat trapped on a pole a happy ending!
Don't lose your shirt on the Grand National, says charity
If you're tempted by the possibility of a big win on this week's Grand National, a charity has a message for you.
Good weather could bring aurora sightings
The Isle of Man could be in for a spectacular treats in its skies tomorrow.
Team on the way to help Top Cat!
Manx Utilities says it’s sending a rescue team to help a northern pole cat.
