The Pialligo Estate restaurant and function centre is in talks with financiers to try to save the business.
But people who have already booked for big functions have been warned they may want to look for other options.
"Negotiations are continuing with the financiers and it is hopeful that a clear picture will emerge within the next 48 hours," a statement from Pialligo Estate Operations said on Monday night.
"And this will include a position on the fulfillment of booked events.
"With that said, at this point we cannot guarantee any outcome and guests with bookings in the immediate future may wish to mitigate their risk by considering alternate options."
The potential financial collapse of the popular Canberra venue first emerged on Friday when The Canberra Times reported it had just stood down staff, shut down its website and closed its doors to the general public.
Members of the Canberra and Queanbeyan hospitality industries then answered the call for help so weddings already planned for Pialligo Estate over the could go ahead.
But the statement makes clear how serious the situation is.
"Whilst aware of difficult trading conditions and still in recovery mode from multiple stressors including two separate fires and two separate lockdowns, it is understood that the financial circumstances impacting the recent close involved a breakdown in negotiations with financiers," the statement says.
It is not known if one option would be to sell to an outside buyer.
Pialligo Estate is owned by Canberra businessman John Russell. Although the statement is signed Pialligo Estate Operations, he is understood to have approved it.
One person close to the business said that if anyone could pull the business out of a hole, it would be Mr Russell who had put his heart and soul into it.
The concern is for the ongoing viability of the business but also about the staff and customers who have booked big events in their lives like weddings there.
They did manage to hold one wedding there on Friday.
The Plot, on Beltana Road, also owned by Pialligo Estate, also saw the closure of the grocer and coffee shop last Thursday.
However, other tenants at The Plot, including the Bison Glasshouse and Pink Flamingo Interiors, were open and not affected by the Pialligo Estate closures.
Pialligo Estate, which runs the function and restaurant centre on Kallaroo Road, emailed clients on Friday confirming it was closing "temporarily".
The statement implies the situation is more serious than a temporary closure.
"Despite five years of difficult trading conditions, including two fires, the bushfires, lost vintages, multiple lockdowns, and the extended impact of COVID-19 pandemic throughout the country, Pialligo Estate has continued to strive for and deliver excellence," the email read.
"Our team has worked tirelessly to build a business that supports locals and promotes Australian products. Despite of [sic] our best efforts, we have today, temporarily closed."
Like most of the hospitality industry, Pialligo Estate has been hit by the events of the past few years, including bushfire smoke in 2019-20 and COVID lockdowns.
It also had to contend with two devastating fires on its properties.
A fire in 2017 destroyed the main restaurant, the Farmhouse, at Pialligo.
Its smokehouse facility in Hume was also destroyed by fire in 2016.
Pialligo Estate opened in 2013, quickly becoming a popular fine dining spot with a unique location on the fertile banks of the Molonglo River.
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