The authority’s cabinet will meet on Tuesday next week to grant the long lease of land to the south of Scalby Manor at “nil value” to the foundation.
The charity was set up in memory of six-year-old Bradley Lowery who lost his battle to cancer neuroblastoma in July 2017.
One of the last holidays the family had together was in Scarborough and it was during this visit the family got the idea to give other children and families facing similar challenges a place they could get away together to enjoy their time.
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The report, which will go before councillors next week, states: “The Foundation contacted the council to locate an area of land that could be leased to build a state of the art holiday home for children with life-threatening illnesses and their families.
“The property will be built over two storeys comprising of five bedrooms, a sensory garden with hot tub/sauna/pool.”
The land is currently used for grazing.
The report adds that the leasehold value of the land is approximately £15,000 but lies outside the permitted development limits, meaning it was unlikely to ever to have another scheme approved.
The council report adds: “As a small family-based charity, the Foundation will be relying on significant fundraising to bring this project to fruition.
“The council has the ability to use its land to improve the wellbeing of those families assisted by the Foundation, by bringing them to the borough to enjoy a state of the art facility within exceptional surroundings, during periods of serious illness, whilst also promoting the borough’s tourist economy. It is therefore proposed that a long lease at nil value is granted.”
Bradley’s mum Gemma Lowery has previously said the town holds a special place in her heart as the location where Bradley had his last holiday.
She said: “He had an amazing time and we made so many beautiful memories there, so it is a very special place to us.”
Carl Gavaghan, Local Democracy Reporting Service