The supermarket giant wants to extend its plans for a new store on the site of a former B&Q store in Southend to include land owned by Southend-on-Sea Borough Council that encompasses a car park and the Focus Youth Centre.
In return for land, Tesco is in negotiations with the council about creating an improved youth facility.
Conservative councillor Andrew Moring, lead member for corporate support services, said: "This is an exciting opportunity for the town which will provide a major new development and a new and enlarged youth centre.
"The details of the development are in their early stages but it is clear they offer a major regeneration opportunity," he said.
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