City of Newcastle is reviving a 14-year-old plan to demolish the Mall Car Park to make way for the "Stairway to Heaven" steps linking the harbour with Christ Church Cathedral.
The council has held preliminary discussions with Iris Capital, the company building the East End residential complex, about incorporating the stairs into its redevelopment.
The dilapidated parking station, owned by the council, would be knocked down, but its 380 public parking spaces would be included in Iris apartment buildings on the car park site either side of the staircase.
The council plans to lodge a development application soon to demolish the seven-storey parking station.
Councillors were briefed on the plans in confidential session on Tuesday night with a view to more detailed negotiations with Iris chief executive Sam Arnaout.
Iris would need to revise its approved state government concept plan, which includes apartments where the stairway would start in the Hunter Street Mall.
The stairway, first envisioned by EJE Architecture's Barney Collins in 2006, includes a pedestrian bridge spanning King Street to the grounds of the cathedral.
EJE director Glen Spicer, who sits on the city's Urban Design Consultative Group and the Property Council, welcomed the plan's revival.
"It'll be the most significant urban design gesture this city's done for years," he said.
"When any tourist comes to Newcastle they'll be able to stand from the harbour, see up to the cathedral and know how to get there.
"They'll see this grand staircase going up through the Mall. It'll be magic, like Newcastle's Spanish Steps."
The council closed the parking station in March due to what it termed a "potential" structural problem.
Chief executive officer Jeremy Bath said in September that he was awaiting a second cost estimate on repairs before briefing councillors on the car park's future.
Mr Arnaout said at the time that the car park site was not on his agenda, but "if and when it ever became an opportunity, I'd consider it".
Lord mayor Nuatali Nelmes said on Tuesday that the council needed to "seize the day" to secure the "most iconic view corridor in Newcastle" while retaining public parking and the senior citizens centre on the ground floor of the existing car park.
She said Iris could build the staircase in return for the car park land, "but that's all what's going to be negotiated after hopefully this week".
The Newcastle Herald attempted to contact Mr Arnaout for comment.
UDCG member Philip Pollard said the staircase could open on to cafes, restaurants and galleries.
"It's a fantastic urban opportunity," he said.
"The structural works to the car park turned out to be so severe that it's not viable to patch it. And stage three [of the EastEnd project] hasn't started yet."
Mr Bath said the "grand staircase", shop fronts, landings and courtyards would bring a "European Quarter feel to this part of the city".
"Given the poor structural condition of Mall Car Park, the significant costs associated to rectify and bring the car park up to current standards, the city does not intend to repair or reconstruct it," he said.
He would ask councillors next week to refer the plan to the council's asset advisory committee and UDCG for advice.
"The Newcastle Inner City Residents Alliance will also be formally consulted," he said
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