Pub giant Punch Parnerships has been given permission to turn a popular Warwick watering hole into a house after revealing that the business was no longer viable.

The decision means the Zetland Arms, in Church Street, will have called time for good having been closed to customers for more than two years.

Members of Warwick District Council's planning committee were told at their meeting this week that a fire risk assessment had halved the number of customers able to be served at the pub while estimates for renovation work came in at more than £200,000.

Jeremy Heppell, speaking on behalf of Punch, explained that the building's Grade II listing also made it difficult to meet some of the requirements thrown up by fire inspectors.

He said: "The closure of the public house, while regrettable, is unavoidable because of the recent fire risk assessment which has reduced the capacity of the pub from 100 excluding staff to just 60 people including staff. 

"This is because there is just one exit from the building onto public land. The applicant investigated alternative fire escape solutions via rear gardens of adjoining properties but these owners were not willing to grant Punch the right of access over their land.

"The resulting reduction in customer numbers along with the significant cost of renovating the building make the pub unviable and there is no way to rectify the fire safety issue without substantial physical changes to the building – ie knocking another access through from the front."

The council received 18 objections to the change of use application, many of them saying that, if approved, it would result in the loss of a valuable community asset and meeting place on a route between two of Warwick's key tourist sites – St Mary's Church and Warwick Castle.

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It was also argued that the Zetland Arms should remain a pub because it was distinct from others in the town having such a large beer garden which made it perfect for families.

John Beaumont spoke against the plans. He told the meeting: "For nearly 100 years the Zetland Arms has been a key feature in the social and community life of Warwick.

"It is ideally sited to serve both local residents and tourists and has hosted many community events and an asset of great community benefit."

The pub's conversion to a house would mean three parking spaces would need to be provided but, in their report, planning officers explained that a parking survey concluded there was sufficient on-street capacity which had led to Warwickshire County Council's highways team to raise no objection.

Councillors unanimously approved the change of use application.