Controversial plans to build 49 new houses on a Lancaster car park as part of the Canal Quarter development have taken a step forward.
South Lakes Housing and Tyson Construction have been given exclusive rights to draw up proposals for a new affordable housing and mixed tenure development on the Nelson Street car park.
The new housing will be part of Lancaster City Council's long-held ambition to develop the Canal Quarter area of the city, transforming derelict and underused land into a brand new neighbourhood.
There are also longer-term plans to build on car parks on St Leonard's Gate and Edward Street.
But the plans to build on car parks have been opposed by residents and Lancaster business owners, who are worried about a potential loss of parking spaces.
A city council spokesperson said this week that work is already under way to increase the available spaces on other car parks.
The Castle multi-storey car park is also set to reopen in April 2026, after a period of closure for refurbishment.
More extensive parking on Kingsway is also being explored, which would provide overspill capacity and extra spaces for busy times such as when festivals and events are taking place, said the spokesperson.
By April 2026, the council says, despite losing Nelson Street, it’s planned that the total number of spaces will increase to 1,554, rising to 1,654 with Kingsway. This exceeds the current availability of 1,329.
In October 2024, the council announced plans to work towards providing 1400 to 1500 car parking spaces in the city centre in future, after previously targeting 1300 to 1400 spaces.
In the long-term, the potential for multi storey car parking or the use of decking to increase the capacity of current car parks in the city is also being investigated.
It likely to be at least a year before the development begins and the car park closes.
“The development of the Nelson Street car park will make an important contribution to the supply of new housing within the city centre, including the provision of affordable homes," said Councillor Caroline Jackson, leader of Lancaster City Council.
“We’ve listened to the city’s businesses and understand their concerns over the loss of these valuable car parking spaces.
“That’s why, by the time the car park has to close for development, we will have measures in place that should lead to an overall net increase across the city compared to what we have currently.”
The council is also looking to introduce a new car park vehicle counting system to make it easier for motorists to find a space at busy times.
This system will provide motorists with real time occupancy data, meaning they will be able to see where there is capacity available. It is currently out to procurement with a view to being installed later this year.
The development of 49 affordable homes is set to be built by South Lakes Housing (SLH) to help meet the urgent need for affordable housing throughout the area.
SLH is an independent, not-for-profit housing association and has previously worked with the city council on the award-winning Lune Walk development at Halton.
Martha Shields, head of development at South Lakes Housing, said: “As a local housing association committed to addressing the acute need for affordable housing in Lancashire, South Lakes Housing is delighted to have secured this opportunity.
“As part of our ongoing investment in existing and new build housing, the site will integrate with the canal environment and will provide high quality, eco-friendly homes for local people.
"We are committed to the highest standards of environmental design and performance and meeting the challenge the city council has set in declaring a Climate Emergency.
“We are intending to deliver a Passivhaus build, which is a performance standard enabling drastically reduced energy requirements for heating and cooling while maintaining comfort for occupants.”
The project has been developed with the support of the Brownfield Land Release Fund (BLRF2) from the One Public Estate programme - a partnership between the Office of Government Property in the Cabinet Office, the Local Government Association and the Ministry of Housing, Communities and Local Government.
The idea behind the Canal Quarter development is to bring back into use many of Lancaster’s important buildings and derelict sites across 6.5 hectares of land, to "create a vibrant, sustainable, and active place which is integrated with the city centre and the Lancaster Canal".