WINNIPEG -- A vote at Winnipeg City Hall on Friday may have pitted social housing against heritage.

City council voted to designate part of the McLaren Hotel on Main Street historic to preserve some of the building's elements. It's a move that could pave the way for a new building beside the hotel to house people coming out of the homeless shelter system.

McLaren Hotel owner Rubi Gill spelled out his plans to city council: a 108 suite addition to rise on the parking lot beside the hotel.

One-third of the rooms would be transitional housing for people who no longer need the shelter system, but are not ready to live independently.

"The building will provide the most critical step to alleviate the bottleneck of the housing issue," said Gill.

Gill said the new building could cost more than $20 million and could take at least a year to secure financing through other levels of government as this is a social housing project.

He said he is working with the Main Street Project, which has an office in the current hotel.

Main Street Project Executive Director Rick Lees said many people in the expanded shelter system due to COVID-19 are ready to move to transitional housing.

"The McLaren is a real great opportunity if we can hang on to what we've created through COVID in the shelter side, we can start moving people into transitional housing," he said.

The city's historical buildings committee was recommending heritage designation for the McLaren to preserve the entire structure. Gill said he is planning to renovate the hotel for current residents, and he said the designation would devalue the land and mean added costs to upgrade windows.

So city council voted on a half measure, designate the brick walls on the Main Street and north sides of the building, plus the flagpole, leaving the other sides unprotected.

Heritage Winnipeg was pushing for the original plan, protect the hotel outright.

"The designation of the entire building would not impede the new addition for the interim housing," said Cindy Tugwell, executive director of Heritage Winnipeg. "If the walls had to come down on two sides, the building wasn't worth protecting – it would probably have to be demolished."