Loch Fyne, on Glossop Road opposite the Hallamshire Hospital, closed in 2016 and the grade II listed Victorian building has been vacant ever since.
The distinctive red brick building was originally a terrace of six town houses.
It was the popular Hanrahans bar in the 1980s and 90s and in 1999 it recieved a £500,000 facelift to freshen up the image and expand the bar’s appeal.
Hanrahans closed its doors in 2008 to become the fish and seafood restaurant .
Now developers hope to transform it into 27 one, two and three-bed apartments. A three storey rear extension would be also created with a glass link atrium connecting a brick residential block to the rear of the listed building.
Conservation groups are concerned though. The Georgian Group says: “This scheme has the potential to rob this Grade II listed terrace of much of its surviving architectural and historic interest and to cause harm to the surrounding conservation area.”
The Conservation Advisory Group has called it a “gross overdevelopment” and says the 1840s character at the front, particularly the door surrounds, would be harmed.
And Hallamshire Historic Buildings Group says: “Proposed aluminium cladding is a hideous disfigurement of the splendid Glossop Road elevation.”
The University of Sheffield is concerned about the impact of building works and the apartments on activities at Sheffield Institute for Translational Neuroscience and Barber House, which has delicate microscopy and imaging equipment.
It also says neighbouring properties on Glossop Road and Ruth Square could be overshadowed.
But officers have recommended that councillors approve the plans.
They say: “The glass link provides ‘breathing space’ for the listed building and firmly establishes where new departs from original.
“The long term use of the listed building in this housing area is considered a major positive factor. The building is vacant, in need of a new use and restoration and would be a helpful contribution to Sheffield’s housing land supply at a time of shortage."
The planning committee will decide at a meeting on Tuesday, February 18.