A former Brighton pub which has been protected from conversion is being turned into a cafe bar after its new owners plans to turn it into a lettings agency were thrown out.

The Horse and Groom in Islingword Street was sold to student landlord Craig Dwyer-Smith by Enterprise Inns in January, and campaigners succeeded in persuading the council to list it as an asset of community value, protecting it from conversion.

Mr Dwyer-Smith both appealed against the listing, and applied to turn it into a lettings agency, but both bids were unsuccessful – and the council also said he shouldn’t be renting out the first floor flat to sharers.

He has now agreed to lease it to the owners of the Blue Man restaurant in Queen’s Road, who plan to open it as a cafe serving food, wine and hosting live music.

Jess Woodfall, who runs the Blue Man with her partner Magic Bensliman, said: “It’s not going to be a Blue Man, it’s a completely different cafe bar – not a boozer or a pub.

“Magic has been living in Hanover for years and we thought it would be really nice to do something because of the whole community thing.

“We’re hoping to open early to mid November but we’re going to open slowly. We’ll be open in the morning until later with live music. We’re disabled friendly.”

Mr Dwyer-Smith said: “I have now rented the property out as per the ACV rules – it will remain to be used as before.

“The upper parts were rented out to tenants on a caretakers tenancy agreement – this was essential due to the property continuously being broken into by potential squatters.

“The upper parts will eventually be rented out to the landlord of the lower area which is ancillary to the premises below.

“I think you will find we are doing all we can with in our rights.”