An abandoned military base has some of the most valuable and unused land in Winnipeg, but an ongoing court challenge is keeping the future of the Kapyong Barracks site uncertain.

The barracks, which used to house members of the Princess Patricia's Canadian Light Infantry, have been sitting empty for more than eight years, after the Canadian Forces declared the site surplus.

Today, there are obvious signs of deterioration on the 90-hectare site, including mould and peeling lead paint inside some the vacant buildings, water in the basement of at least one building and hundreds of squirrel holes outside.

"I don't think it's good for the neighbourhood," said Joe Chilelli, who lives nearby.

"You see all the grass, and the buildings are just left there, barren."

But since 2008, a court challenge has been holding up any development on the land where the base sits.

Six First Nations have been fighting with the federal government, arguing that a treaty signed in 1871 gave them first right of refusal on any land Ottawa declares surplus.

"They are willing to wait a couple more years, for sure, in order to get their promise fulfilled," says Norman Boudreau, a lawyer representing the Sandy Bay First Nation.

Chief Donovan Fontaine of the Sagkeeng First Nation said any development they would bring to the Kapyong Barracks site would benefit everyone.

"The city wants taxes, they want economic spinoff as well," he said. "Everybody could benefit from this."

The land claim challenge returns to court in December, but either side could appeal. A lawyer for one of the First Nations told CBC News an appeal will likely happen.