A RIVERSIDE eyesore is to be sold in a bid to attract entrepreneurs with a vision to transform it back into an attractive city landmark.

City of York Council bosses have agreed to resolve a long-running dispute over the state of the Bonding Warehouse by working with the leaseholder to sell the neglected property.

It is hoped investors will see its potential in the same way developers did with other buildings such as Lendal Tower.

The former bar and restaurant on the Skeldergate site was devastated by floods in 2000. Its unused and derelict state since then has been the subject of a protracted dispute between the council and tenants Lionel Davis and Keith Carby.

Investigations into the council's legal position relating to the lease, which was granted for 50 years in 1978, have dragged on.

But council executive members decided yesterday to reach a settlement with the tenants and come to a legally-binding agreement to dispose of the building. Their other option was to consider legal action against the tenants to forfeit the lease, citing non-payment of rent and failure to repair the premises.

Coun Quentin McDonald, corporate services chief, said: "We have spent a long time working towards this. The terms we have come to are not ideal, but it is probably as good as it gets."

Coun McDonald won full support after urging members to back the proposal to reach a settlement so that "the Bonding Warehouse goes on the market as soon as it is practical to do so".

Council leader Steve Galloway stressed the building's future role was not set in stone.

"We are not in any way being prescriptive about the use of the Bonding Warehouse in future. It would be suitable for residential conversion but that's not the only option.

"If developers come along with other plans, we are flexible."

However, developers would have to secure planning permission for any change of use, taking into account the building's location adjacent to accommodation for elderly people.

The council has undertaken work to understand the flooding risk and determine what defences might be needed to make the building useable again.

Coun Macdonald said that report would be available to all potential purchasers.

"No one will go into this with their eyes shut."