Taylor Square's T2 building, the previously proposed site of a permanent Mardi Gras museum

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Controversy continues in the wake of a City of Sydney Council vote to turn the T2 building at Taylor Square into a bike hub.

The last general Council meeting saw the bike hub plan approved, sealing the fate of the iconic Darlinghurst building.

A spokesperson for the City of Sydney said the former nightclub was bought by Council in 2009, contingent on its use as a bike hub.

“This was supported by a business case showing that the bike hub could help rebalance the social needs impacting Taylor Square by providing a venue primarily used in the daytime,” said the spokesperson.

“Bike riding has grown dramatically in Sydney over the last few years. 31,600 City of Sydney residents are on a bike every week,” she said.

Council aims to create this hub connecting Sydney’s network of bike lanes as a central site for cycling culture.

But some councillors have criticised the plans for the T2 building as cycle-biased, and say other viable options such as an LGBTI museum were disregarded.

Liberal Councillor Edward Mandla said the decision to create the bike hub was rushed through by Council in the same way the disjointed bike lane network was.

“The Council is crashing through this bike hub as they’re in a panic because the community’s waking up that a great piece of historical property is being squandered,” said Mr Mandla.

Mr Mandla questioned the decision to award the tender to a sole business owner who will have to manage both retail operations and industry groups.

Living Sydney Councillor Angela Vithoulkas said: “I believe that it was the need for the Lord Mayor to continue with this legacy of bike path building and confusing this with a bike hub.”

Ms Vithoulkas said an LGBTI museum should have been established as an acknowledgement of the struggle of the gay and lesbian community. The museum would have encouraged the economy of the area and acted as a tourist drawcard, she said.

Labor Councillor Linda Scott sought to have the site turned into a museum and campaigned to provide it with funding of a million dollars.

“It’s my view that the area of Taylor Square is a place that has a significant history and at the moment you can walk up that street and have no idea about the history of the space,” said Ms Scott.

However, Mardi Gras CEO Michael Rolik said he supported Council’s decision to establish a bike hub.

“We explored the possibility of the T2 building becoming a home for a permanent museum. In the end, given our limited resources, we decided to present a more manageable exhibition at 104 Oxford Street,” said Mr Rolik.