Plans to create a world-class streetscape around Belfast City Hall have been put on hold after £113,000 was spent developing the proposals.
The second phase of the Belfast: Streets Ahead programme – the pedestrianision of Donegall Square – was launched in February 2012.
Social Development Minister Nelson McCausland has now instructed officials to start work around the University of Ulster's York Street campus and the Royal Exchange development instead.
The first £28m phase of the regeneration project improved 14 streets in Belfast's commercial and retail centre. The second phase was supposed to present the City Hall as the "jewel in the crown", with plans to transform Donegall Square North, East and West.
Now the Department for Social Development (DSD) has said work there will be put back. It said the shift in priorities would bring "more economic benefits and stimulate more growth in the retail and property sectors in the core retail area".
The announcement comes after months of criticism of the Department for Regional Development's Belfast On The Move road works scheme.
The project, which has introduced new bus lanes to the roads close to City Hall, has been lambasted for causing major disruption to traffic. The plans which are being moved forward include the area from Royal Avenue through to the Cathedral Quarter and the University of Ulster's new £250m Belfast City campus.
Mr McCausland said: "These projects, and other regeneration plans for the adjacent Northside Urban Village, provide scope to significantly improve the residential capacity in the vicinity and potentially increase consumer spend within the city centre."
The DSD confirmed the development stage had cost £113,000, but said the work was "not lost".
"The work carried out to date is not lost and can be picked up when the Phase 2 project recommences in the future," a DSD spokeswoman said.
The University of Ulster welcomed the move, saying it "recognises the capacity of the campus to transform the northern edge of the city centre and the benefit for the wider city and the region."
"The university has always believed our new campus can be transformative," said pro vice-chancellor Prof Alastair Adair.
"The proposed new University of Ulster's campus at York Street and the granting of planning permission for the Royal Exchange development, have provided a fresh opportunity to enhance the connections between the north-side of the city centre and the retail core through to the City Hall."
Social Development Minister Nelson McCausland