Local housing association Fyne Homes has submitted a proposal to Argyll and Bute Council to retain the B-listed structure and to turn it into a combination of one, two and three bedroomed flats, aimed at first time buyers in particular, along with at least one commercial unit.

Councillors were due to consider Fyne Homes' proposals for the lower site, which is still owned by the council, at a meeting at the authority's Lochgilphead HQ on Thursday morning.

Members of the council's executive committee have been asked to instruct officials to begin negotiations with Fyne Homes for the sale of the site - if they feel the proposal is an acceptable one.

The plan, if it is accepted, would tie in with the redevelopment of the upper part of the former Academy site, which Fyne Homes has purchased from the Bute Estate, and which already has outline planning consent for a housing development.

The redevelopment proposals have been drawn up by Fyne Homes in conjunction with civil engineers Ramage Young, quantity surveyors Neilson Binnie McKenzie and architects from Collective Architecture.

The first phase of the plan would see the B-listed main building refurbished and converted to house 32 residential units - eight with one bedroom and 20 with two, along with four three-bedroomed houses, the last of which would occupy the former home of the Academy's assembly hall.

Phases two and three would concentrate on the upper half of the site, adjoining Westlands Road, with the second phase seeing the existing unlisted buildings being demolished and 25 houses and 16 cottage flats built in their place.

The third and final phase would see 16 homes built on the westernmost part of the site, giving a total provision of 89 homes.

Fyne Homes director Alan McDougall confirmed: "Fyne Homes has submitted a draft proposal to Argyll and Bute Council regarding the development of the Rothesay Academy site.

"The site has significant potential and we hope that the councillors agree to negotiate with Fyne Homes regarding the proposal following the forthcoming meeting."

Even if councillors do give Fyne Homes' proposals their support, the timing of any phase of the project will depend on the association receiving funding from Communities Scotland's investment programme.

The main building at the Chapelhill site was completed in 1958 as a replacement for the iconic Gothic structure which had housed the Academy's secondary pupils since 1870, and which was destroyed in an arson attack in March 1954.

But the structural shortcomings of the new flat-roofed building soon became apparent, though that didn't prevent Historic Scotland giving it B listed status in November 1997 on the grounds that it was a particularly notable example of that style of 1950s architecture.

The apparent contradiction was thrown into even sharper relief by the realisation that the 1930s Art Deco building on the upper half of the Academy site, which used to house the school's primary classes, was in much better condition, and was arguably of much greater architectural value, and yet had no listed building status at all.

The Academy site has lain empty since the school's move to the new Townhead joint campus, which it shares with Rothesay Primary, Bute Pre-5 Centre and Argyll College, last summer.

* View Fyne Homes' proposals at http://tinyurl.com/6psek3 - this address redirects to the page on Argyll and Bute Council's website where the papers for Thursday's meeting have been published. You'll need Adobe Acrobat to read the documents - and the file sizes are pretty large, so they may take a little while to download.