A derelict old building in a Wolverhampton conservation area is to be transformed into 12 apartments after council chiefs secured £520,000 of funding from the Heritage Lottery Fund.

Number 182 Stafford Street, a red- brick 19th century building in St Peter’s ward, was last used by the University of Wolverhampton as offices a decade ago.

The revamp was today described by city regeneration bosses as “wonderful news”, with work set to start on renovations immediately. The investment will go towards bringing the building into viable use by giving it a new roof, structural repairs and windows, before Oswin Developments create six two-bedroom and six-one bedroom properties inside it.

Oswin Developments is the firm behind the £35 million revival of Wolverhampton’s Low Level Station, which includes 200 homes, a hotel, casino and a pub. Councillor Paddy Bradley, cabinet member for regeneration in the Tory-Liberal Democrat alliance, said: “This is wonderful news for the area. The regeneration of buildings like this in Wolverhampton is absolutely crucial to the well-being of the city. We hope for many more.”

The site lies within the city centre conservation area and is characterised by 19th century red-brick buildings with Welsh slate roofing.

Number 182 Stafford Street is next to the old drill hall offices and was used by the old School Board and as a registry office in the 20th century.

Planning permission to turn the building into homes was approved in May, after which the focus turned to persuading heritage lottery chiefs that more than £500,000 was needed to improve the site before further progress could be made.