Councillors have voted to ‘investigate further options’ for an historic Bognor hotel.
A planning application to convert the Royal Hotel into 18 flats was granted in September last year.
Earlier this year the town council revealed it was considering restoring the site in The Esplanade as a boutique hotel, chef training facility, council offices and community space.
Town councillors were torn in their decision to either continue investigating further options for the site, or to terminate the project at a meeting on Tuesday night.
The vote was split four against four with town mayor Stephen Reynolds having the final say.
He said he was interested in continuing to work with town councillors in partnership with neighbouring councils.
Lib Dem Matt Stanley voted against further investigation into other options.
He said: "I’m left with no doubt that it wasn’t achievable for us.
"As much as it is something I would like to see happen I don’t see how we would achieve it."
Sandra Daniells, Independent aligned Conservative, said she thought the project was a ‘dead-duck’ and said: "Everything is pointing to the fact that this isn’t completely viable."
It was revealed at the meeting that Butlin’s had shown an interest in the project, as well as interest from Goodwood from an ‘advisory point’.
Labour’s Jan Cosgrove said that similar schemes had worked elsewhere and that he considered it an important site.
He said: "It could have some value as a project to take on board.
"It doesn’t hurt to keep this on the table."
Progress and developments about the project will be discussed at another council meeting set for November.
Councillors then voted to invite Arun District Council to discuss the future of the town hall as they looked at the future of the listed building, which became a community asset earlier this year.