The suggestion that the council-owned building at Museum Place would be leased to youth mental health services sparked a flurry of concern from community groups.

However, the council was advised on Monday July 13, that Relationships Australia "decided to pursue a different leasing option".

Relationships Australia Canberra and Region director of operations, Julie King, said the Batemans Bay Community Centre was one of three premises being looked at.

Ms King confirmed the Batemans Bay Community Centre was no longer being considered and Relationships Australia was yet to decide on a premise for the Headspace service.

Ms King said Relationships Australia was excited to establish Headspace at Batemans Bay.

"We are committed to Batemans Bay and supporting the community," she said.

Last week, Batemans Bay U3A president Ross Thomas received a call from the council informing him the Batemans Bay Community Centre could be leased to Headspace for two years and that community groups who used the facility would need to relocate.

"We are supportive of Headspace's efforts to promote the mental health of young people but we feel that our efforts to promote the health and well-being of the older members of the community will be undermined, if we are denied access to our community centre," Mr Thomas said.

There's 650 members of Batemans Bay U3A who use the community centre for weekly classes and activities. Mr Thomas said U3A is one of many community groups who use the centre.

READ MORE: Lead agency chosen for Batemans Bay's Headspace service

Mr Thomas said U3A looked at relocating last year, although no lease options met the group's needs nor budget.

He said the group's demographic was mostly elderly who needed wheelchair and ground floor access.

"Other function centres the council has, are no good for some of our people," Mr Thomas said.

The group had also been denied access to use function rooms at clubs and aged care facilities because of the COVID-19 risk.

"We have become more dependent on council's facility than before - because of the virus we're unable able to use facilities at the Manor or Banksia village," he said.

Mr Thomas sent letters to the council's general manager and councillors on Monday, July 13, asking to reconsider leasing the centre.

"The community centre is for community groups to make use of, and not to be arbitrarily taken from the community and made available to a national organisation which has the funds," he said.

U3A member Dianne Grigson said it would be "a disaster" to lose access to the community centre.

"There is just nowhere else with a lovely big wooden floor for our dancing and exercise classes which are held three times a week and have been for years," she said.

Ms Grigson also said it was the only council venue that had audio-visual facilities, which was essential for classes.