Businessman Howard Plant has been refused permission by Blackpool Council to bulldoze the former Woolworths store on the corner of Bond Street and Waterloo Road in South Shore.
It opened in 1928 as Blackpool's second Woolworth's before closing in 1994.
Hartes, which became well known for its Christmas displays, then occupied the site for 25 years before closing in January 2019 to focus on online sales.
Mr Plant says the property, which is locally listed meaning it is considered to be a heritage asset, was already in a state of neglect when he bought it with his business partner two years ago.
Photographs, which he says were taken just after the purchase, show dilapidation including damaged brickwork, collapsed timbers and rotten window frames.
Mr Plant, who already operates car parks in Blackpool, wants to clear the site and provide a 43-space car park which he says will serve nearby businesses and boost trade in the neighbourhood.
He said: "Bond Street is desperate for a car park and our plans would help attract trade to the area. There is planning permission for a new hotel on the Promenade nearby and the car park could also serve that development.
"So we feel this is by far the best way forward for the site.
"When my business partner and I bought the property around two years ago, it was already in a state of disrepair.
"It would cost up to £500,000 to renovate it, and then we would be left with a large shop in an area where businesses are already struggling to survive."
Council planners refused an application for demolition of the building because bats are believed to be nesting there, rather than because of its locally listed status.
A decision notice says approval was not given because "the applicant has failed to demonstrate that the method of demolition proposed would adequately safeguard protected species and so prior approval must be refused."
Mr Plant says he is proposing to appeal against the council's decision.
Coun Derek Robertson, who represents Waterloo ward, also believes the building has fallen too far into disrepair to be saved.
He said: "My concern is the state the building is in because it doesn't look safe. It's an eyesore and I think local people want it demolished now.
"Even though the owners have boarded it up, people have broken in and slept there and we don't want that.
"If it becomes a car park, that might attract more shoppers to Bond Street which the area needs.
"The building is on a prominent corner of this part of South Shore, but it looks abandoned so it just needs to come down."
The site was considered worthy of preservation when it was locally listed by the council in 2013 meaning it is considered to be a community heritage asset.
However being locally listed is not enough to protect a building from demolition - it is just one issue which must be considered by planners in their decision making process.
In recent times other locally listed buildings including The George Pub on Central Drive, which was deemed unsafe, and the Empire Bingo Hall on Hawes Side Lane, which had become unviable, have been demolished.
Blackpool Civic Trust did not object to the application for the demolition of the Hartes building, but chairman Joan Humble said concerns had been raised at its last meeting of members.
She said: "It would be sad to lose that building because it has been a landmark building in that area for a long time."
She said the Civic Trust monitored all applications involving locally listed buildings, but added: "Locally listed buildings do not have the same level of protection within the planning system as those that are nationally listed, although the local authority always looks closely at these applications."
Deterioration of the building uncovered by an engineers report submitted with the demolition application includes "a lack of lateral bracing to the structure" which is needed to protect it from collapse.
The assessment adds: "The shop frontage on both Bond Street and Waterloo Road was found to be in a dilapidated condition.
"The timber was found to be suffering significant wet rot to the extent that two of the bays had additional temporary support added to prevent the glazing falling out into the high street."
Window frames were also described as rotten and as having suffered from vandalism.
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