Weymouth and Portland Borough Council and a developer have settled a legal dispute over the fate of the former council offices.
The council last month lost a planning appeal over the North Quay site, but avoided a cost order being made against it.
Developer Acorn had appealed against the council’s refusal of planning permission for change of use from offices (B1) to C3 residential.
The council argued that when it used North Quay the building was not in use as an office but was used for the administration of local government, and so was sui generis and not open to be converted to residential under permitted development rights as Acorn had intended.
Weymouth & Portland instead wanted the 1970s building demolished, a course English Heritage has said would “heal the harm” done to the town’s harbour by its mass and appearance.
In a joint statement, the council and Acorn said: “We are pleased to be able to announce an amicable settlement to the disputed issues around the sale of the council’s former offices at North Quay, Weymouth.”
Acorn will retain the deposit paid when contracts were exchanged, and the council will contribute £167,500 towards the developer’s costs.
The statement added: “Following the settlement, [Acorn] will have no further involvement in the site, leaving the council free to pursue alternative plans for the site.
“Both parties agreed that such a settlement was preferable to a long and costly litigation with an uncertain outcome which would distract from other priorities.”