THE former Princess Margaret School, in Middleway, Taunton, is to be turned into a retirement village for scores of pensioners.
Permission was granted for the 97-home development by Taunton Deane Council's planning committee on Wednesday.
They also approved plans, opposed by neighbours, to knock down the imposing Blagdon Lodge and build a new amenity/ clubhouse with apartments.
Officers originally recommended throwing out the proposals by Retirement Villages plc after the company initially refused to include any affordable housing on the site.
But boss Bill Gair backed down just before the meeting and now says he will work to thrash out an agreement with the chief planning officer.
Planning officer Tim Burton told councillors it was "difficult to retain" Blagdon Lodge after English Heritage described it as "below standard" to be listed.
Mr Burton added that the design was of a "suitable quality" and would "enhance the area", while the impact on the neighbourhood was acceptable.
Councillors voted overwhelmingly to approve the plans for 74 apartments, 11 cottages, 11 bungalows and one unit in the converted coach house, along with the residents' clubhouse, guest rooms, laundry.
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