Friends First Assurance Company has sold the former Harvey's department store in Blackpool town centre to the council for £1.4m.
The four-storey building, which fronts Birley Street, Cheapside and Abingdon Street, is currently undergoing a refurbishment by the council
The property is being redeveloped to create a new mixed-use scheme with offices on the first and second floors. The internal space totals 28,500 sq ft.
Work is expected to be complete in August this year.
King Sturge acted on behalf of the owner, Dublin-based F&C Ireland, which manages funds on behalf of Friends First Assurance Company, on the deal.
Blackpool Coastal Housing, the arms-length organisation set up by Blackpool Council to run its stock of 5,800 homes, is currently negotiating to take 15,000 sq ft on the top two floors. The organisation plans to occupy part of the ground floor with its Home Stop Shop.