The council, supported by the Scottish Executive, last month slapped a moratorium on planning applications on the 176 ha Granton Waterfront as it wants to give precedence to a Llewelyn-Davies £500m-800m masterplan for the wider area. This scheme is set to be Scotland's biggest regeneration project.
The Foster plan was to redevelop a heavily contaminated British Gas site into a mixed-use scheme. In order to offset the cost of soil remediation, the scheme proposed the construction of a major supermarket. However, the proposal for the supermarket has proved controversial.
Edinburgh City Council, which has also expressed an interest in buying the site, has commissioned a retail impact study to assess whether there should be a large retail development in Granton and, if so, where it should be located.
A source close to the project said: "The combatants are moving around each other at the moment. There is a concern about the impact of a major retail outlet on local centres."
A second scheme now under threat is a CD Associates plan to redevelop Granton Harbour for Forth Ports' property division. The proposal has been opposed by residents.
They are concerned about the provision of luxury housing and leisure facilities, which they fear could precipitate a property boom that would make housing too expensive.
The parties to the regeneration of Granton are now discussing ways of accommodating the different interests of the parties.
A source at Llewelyn-Davies said of the CD Associates' scheme: "We are developing our own view about how the harbour might be developed. We are hoping the two can be reconciled."
However, Edinburgh City Council has made it clear that its planning requirements will be decisive. Alan Cooper, head of major projects at the council, said: "British Gas and Forth Ports have to get their ideas to accord with ours."
The Llewelyn-Davies' masterplan is due to be delivered at the end of this month. Edinburgh council intends to launch the scheme on 8 December. There will then be a three month consultation exercise before implementation begins.
The client for the Llewelyn-Davies scheme, which will include 3000 homes, is Waterfront Edinburgh Partnership. This is a joint venture between the council, Lothian and Edinburgh Enterprise and Scottish Homes.
Llewelyn-Davies replaced CZWG/EDAW in June as masterplanner of the waterfront area.