The tourist information centre building is set to be turned into a restaurant.
Scarborough Borough Council confirmed at a Cabinet meeting on Tuesday that it was now considering a shortlist of two tenders, ruling out the possibility of the tourism offering being retained at the building at Dock End.
A report put to councillors said: “Following the initial analysis of the submissions, two tenderers are both offering restaurants with outdoor seating provision.
“Whilst it is not appropriate at this stage to disclose the tenderers details, neither are presently represented in Whitby and both are local businesses from within the borough.”
Both bidders have put forward sums of over £50,000 for the annual rent and for a 21 year lease.
It was also stated in the report that both bids sought permission to have an outdoor seated area associated with the restaurant which will be under a separate licence.
This is going to be considered at a later date following discussions with Whitby Town Council as there will be a clash with events held at Dock End such as armed forces and Remembrance Day events.
A final decision on that has been delegated to Cllr Mike Cockerill who is the Portfolio holder for harbours, assets, coast and flood protection.
It was also agreed to by councillors that Cllr Cockerill and Nick Edwards, the authority’s director of finance, will be delegated to deal with the completion of the tender evaluations and also finalising legal terms and contracts.
The TIC lease has been marketed since February and the closing date was June 13.
Marketing details were sent to 22 interested parties, four of which arranged viewings at the premises.