An iconic Highbury pub beloved by generations of Arsenal football fans is set for a new lease of life.

The Gunners on Blackstock Road is full of Gooners memorabilia and also hosts live music.

Islington’s planning committee approved plans to extend the Victorian pub, complete with a basement for music. There will also be a shop and six homes, plus a flat for the pub.

The applicant has agreed to pay £350,000 towards affordable homes elsewhere in the borough.

The planning committee rejected an earlier design over concerns that the extension was too excessive and worries about loss of light and sense of enclosure for neighbouring properties.

The applicant went back to the drawing board and reduced the height of the extension and moved balconies from the back to the front of the building.

Agent Mark Sheerman said the applicant had worked with the planning department over three years to develop this scheme.

He said: “The proposals will regenerate this run-down site, creating high quality new homes and, crucially, facilitating a wholesale refurbishment of what is an iconic Highbury pub.”

He said it would give the pub “a shot in the arm” with significant investment and said the pandemic had hit the industry hard.

He added that the sound insulation will “significantly improve” conditions for neighbours as the outdoor area will be removed and music from the basement should not be heard outside.

The plans had 47 letters of support and two letters of objection with concerns about noise.

The Greater London Assembly (GLA) supported keeping the pub and creating a permanent music venue.

It pointed out that London lost a third of its live music venues between 2007 and 2017.

“These venues are part of London’s lifeblood, important economic drivers for borough economies, and contributors to the city’s cultural vibrancy and diversity,” the GLA told the planning committee.

Cllr Paul Convery said: “I think this is a good example of a negotiated scheme.

“Fair play to the applicant for engaging with that.”

Co-licensee Una McKernan said: “We are quite delighted that we have got to this stage at this iconic pub.”

The Gunners has been shut for most of the pandemic.

It is hoped that the work could start after the end of the football season and is estimated to be finished 16 months later. The pub will remain open.