A planning permit for the demolition of the run-down facility was granted by the Launceston City Council, with works to be conducted by developer Errol Stewart.

News of the demolition plans was met with protest at Monday's council meeting and the establishment of anti-demolition Facebook group Adaptive Reuse.

The woolstore is not listed on the Tasmanian heritage register.

Heritage building restorer Bruce Crerar said he believed a more innovative outcome should have been considered by the council.

"It's quite significant in the history of Launceston," Mr Crerar said.

"It's not listed with the Tasmanian Heritage Council, but that doesn't really mean anything because they still haven't finished a full investigation of Tasmania.

"Recycling should be investigated to a greater degree, it's a backward decision, demolition is the lazy option."

Mr Stewart said he believed the cost of repairing the building for use was unfeasible, but would use its wooden trusses to establish a sawtooth interpretation display.

"The building is 6000 square metres, let's say that's an average (repair) cost of $15,000 a square metre, that's $6 million," he said.

"Then to flood protect it, to build a flood wall around it would cost about $3 million, that's $9 million — there's thousands of things the city could do for $9 million.

"I think people make assumptions and don't understand that A; it's on the wet side of the flood levy and B; the condition of the building now is worse than poor, it's dangerously inadequate and probably needs to come down sooner than later."

Cost for the demolition is anticipated to be in excess of $150,000, including removal of asbestos.

Launceston general manager Robert Dobrzynski said part of the site would be used for the council's $9 million North Bank redevelopment in the 2014-15 financial year.

Mr Dobrzynski said the council was also anticipating a building permit for the site "in the near future".