James Cameron, of Christchurch, has applied to the Department of Conservation for a 10-year concession to use the Doc-managed building as accommodation, catering for up to seven people.
Doc had advertised for proposals from people wanting to use the building.
No decision has been made yet on the application. A provisional decision is expected soon and it will be advertised for public submissions.
At its meeting in Cromwell yesterday, the Otago Conservation Board confirmed its stance on the concession and also received a letter on the subject from the St Bathans Heritage and Environment Preservation Trust.
"The board believed that the overall concept of the proposal is good and that the St Bathans Post office building would benefit from use and careful renovation that retained its historic values," board community relations office Mark Clark said.
It was important that the current layout and old fixtures were retained, he said.
The ground floor seemed better suited for retail use - similar to the "Despatches" business the late Sharon Hinds ran in the building.
"It has retained an authentic old 'post office' ambience and it would be a shame to lose this. Such use would also enable the public to get more enjoyment from visiting the site."
St Bathans trust chairman Rob Duffy said the group had concerns about the proposed concession and wanted to ensure the public retained access to the downstairs section of the building.
The post office was sold to the Department of Lands and Survey on the understanding it would be preserved and open to the public.
"The proposed concession flies in the face of that intention," Mr Duffy said in a letter to the Otago Southland area manager of the New Zealand Historic Places Trust, Owen Graham, which he copied to the board.
Ten years was a long time to "lock the public out", he said, and he sought an assurance that the downstairs of the building would remain intact and accessible to the public.
"We think there is a great opportunity here to preserve and restore in order to provide for the public an experience of history coming alive. The proposed concession would totally jeopardise any such project in the future."
In his application, Mr Cameron said that, as a builder, he had undertaken major historic projects here and in England that had involved working sympathetically with the historical fabric to achieve a quality result that retained building character.
He planned to modify the interior of the building, he said.
Conservation work has just been carried out on the exterior of the post office.
