Hundreds of thousands of pounds in compensation could be handed over to the tenants and owners of a Wolverhampton city centre building likely to be demolished to make way for the city’s £180 million Interchange, it was revealed today.

Developers behind the long-awaited scheme, which will bring rail and bus services together, are considering paying £900,000 to transport authority Centro, which owns Pipers Row House, and the organisations which use it. Some cash could also go to those using the Queens Building next door which houses the bus station base.

It is thought Centro would be the main beneficiary of the money. Pipers Row House, which currently is home to a Spar shop as well as other companies, is set to be demolished as part of the £174million project while the listed Queen’s Building will be enhanced according to the proposals.

Details of the compensation package are revealed in a report updating the plans for the Interchange due to the Integrated Transport Authority Annual Meeting on Monday.

Centro, which owns and operates Wolverhampton Bus Station, also owns Pipers Row House but leases it to three tenants. It leases the Queens Building and sub lets some of that to National Express and Travel West Midlands.

Centro spokeswoman Babs Coombes said today: “It would be used to compensate the tenants who will have to move out. We will have to provide it as an empty building for the developers. The other part of the money would go to Centro as a building which would be one of the organisation’s assets would be taken away, that would be invested in transport.”

The first phase of bringing train and bus services together as part of the long-awaited Interchange project is due to get under way in October. Replacing Pipers Row House will be a new two-storey building with 16,000 sq ft of floor space.