Limavady-firm R.V Properties Ltd wants to build flats at the famously haunted former Workhouse in the Waterside.
The company has applied for permission to use the first floor and the vacant museum space on the second floor of the old building to develop six new apartments.
The property, now formally known as the Waterside Centre, which also houses the local library, actually dates back to 1840 and was part of the notorious Workhouse system of the nineteenth century.
Designed by George Wilkinson to accommodate 800 ‘inmates’ it opened its doors to ‘paupers’ in 1840.
In 2014 the old Derry City Council decided to close a museum, which had been in operation at the site since 1997, due to health and safety issues and decreasing visitor numbers.
It said any resource savings would be put towards the proposed new Maritime Museum at Ebrington. The building served as a Workhouse until 1948, after which it was used as a hospital until 1991.
Local legend has it that the entire site is haunted.
Amongst the ghost stories told about the building are that a former nurse, who had taken ill, woke up during her treatment to find a woman, dressed in white, placing an extra blanket on the bed, before disappearing through the wall of the room. Another yearn is that a former matron who stringently imposed rules and regulations, and fretted herself to death after she accidently starved three children to death in a punishment cupboard, haunts the Workhouse.