Plans to transform Dyke Road car park into a high-rise block of flats could cost Galway City Council more than €1m in revenue every year.

The warning comes as the Land Development Agency (LDA) confirmed it would submit a planning application to An Bord Pleanála this March for a nine-storey building with more than 200 apartments.

This stage one of the transformation of the City Council owned land is earmarked for the main central section of the car park.

The top end, nearest the Headford Road, is reserved for commercial units to be built in stage two, and the Black Box area will be left until a later date in the third stage, when an alternative site is found for the venue.

Following a presentation this week to elected members by LDA, City Councillor Frank Fahy (FG) said the 219 apartments will replace 345 car parking spaces that raise about €1.3m annually for the local authority. Some 35 spaces will be set aside for people living in the new development if it’s built.

The former mayor has demanded to know what compensation City Hall would get in return for losing this daily income stream.

He said there would be implications for city ratepayers, too, who rely on motorists coming to Galway and parking at Dyke Road, in the absence of better public transport options.

“How will we be compensated? This is the last major car park in the city. A rough estimate suggests it brings in €1.3m every year.

“If you take away this car park, you are creating a monopoly for the other private multi-storey car parks to charge Dublin prices. Losing more than €1m is a lot of money for us to find every year. In perpetuity, what is the cost over 10 years, 20 years? I want to know how we will be compensated for this,” said Councillor Fahy.

He has suggested the design team could incorporate retaining the ground level car parking spaces, by building the flats on stilts to future-proof for flood risks.

“The dyke was built as a Famine-relief project to stop water flowing over to Ballinfoile. The LDA said they must raise Dyke Road car park to mitigate against future flooding.

“I have suggested that they should leave the car parking spaces – or a certain amount of them – and build upwards with the apartments on stilts. That way we would retain parking, for shoppers, workers, and big events like Macnas parades, and the building would be safe from flooding,” he added.

Pictured: New development in the pipeline: The Dyke Road carpark and Black Box Theatre.