Andrew Robert Gillebaard appeared via video link from custody in Tamworth Local Court when a fresh bid for his release was denied.
Gillebaard was supported by his father when Legal Aid solicitor Patricia Simpson argued there had been a change in circumstances.
She said Gillebaard had pleaded guilty to a single charge and was awaiting sentence after the most serious allegation levelled against him was dropped by prosecutors.
She also said the "onerous" and ongoing COVID-19 situation in Sydney's Long Bay prison had affected Gillebaard significantly, due to his lack of ability to see his family, exercise, and attend specialist appointments needed for sentencing.
"Mr Gillebaard Senior is willing to do whatever it takes to support him," Ms Simpson told the court during the bail application.
She offered a list of strict conditions including to live with his father on a house arrest curfew and steer clear of the Robert Street Shopping Village, where the offence took place on January 26.
Solicitor Rayshele Martin for the state prosecuting authority, the DPP, opposed bail and said she was concerned Gillebaard may commit another offence and endanger the community.
"The circumstances of this offence are quite serious," she said.
She told the court the events involved Gillebaard setting fire to a medical clinic within a shopping centre, causing significant damage while staff were around.
"The behaviour was quite erratic," she said.
The court heard Gillebaard had started the fire inside Better Health South Tamworth at a time when not many community members were around, but Ms Soars pointed out bakery staff and security guards appeared to have been there.
"I can't grant Mr Gillebaard bail today unfortunately," she said.
He will remain behind bars ahead of sentencing for breaking and entering and destroying property worth less than $60,000. He was arrested shortly after the blaze broke out.
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