Controversial businessman Noel O'Gara is to be allowed to keep a plot of land in leafy South Dublin which has been at the centre of a bitter dispute with residents for nearly three years.

The Sunday Tribune understands that Dublin City Council will not execute a compul­sory purchase order (CPO) on Dartmouth Square in Ranelagh.

Officials have decided not to force O'Gara to sell them the park because they fear he would be awarded a large sum in compensation by an independent arbitrator.

The decision was made despite a consultant's report, commissioned by local residents, which found the value of the land to be "nominal".

O'Gara took control of Dartmouth Square in 2005 when he bought it under the noses of the local authority for a paltry sum, estimated at around €10,000, much to the fury of his neighbours.

Since then he has sparked controversy after controversy with attempts to use it as a home for members of the Travelling community, a car park and even a tile showroom.

His unorthodox actions so outraged the public and Dublin City Council that last year they were granted a CPO on the land.

However, the Sunday Tribune has learned that a decision was taken by Dublin city manager John Tierney last week not to follow through and enforce the order which expires next Sunday despite a more aggressive stance taken by his predecessor John Fitzgerald two years ago.

Local Labour councillor Oisin Quinn, who has fought for the matter to be concluded, said that the controversial decision has already cost taxpayers in terms of securing the CPO in the first place.

"The manager made it clear earlier this week that he was not going to serve the notice to treat and this will cause the CPO to lapse," he said.

Orders protecting local architecture and trees forbid O'Gara or any owner from developing the land, making it essentially useless as anything but a park.

A spokesperson for Dublin City Council said the officials had until 22 June to enforce the CPO and that no decision had been made either way.

It is believed officials are intimidated at the prospect of entering arbitration with O'Gara on the sale of the land given that no formal agreement on its value has been reached.

However, a report on that issue by senior council Patrick Butler states that due to protection orders on the site the land is unlikely to ever be developed and subsequently is worth little.

"These lands cannot have more than a nominal value," the report states.

Despite concerns, there remains some hope that the overall war has yet to be won. O'Gara is not the only party with a legal interest in the land and some believe this may be used to beat him.