This area is vital to Mather's reorganisation of the arts complex 鈥� the masterplan proposes a four-storey mixed-use building on the site.
Lambeth council's argument is that the gardens and car park are "metropolitan open land" and therefore must remain areas of public open space.
A policy proposed by Lambeth council on Monday read: "Commercial development has been proposed for part of this area in the emerging South Bank masterplan. Commercial development is an inappropriate use of metropolitan open land."
A spokesperson for the South Bank Centre said Lambeth's policy would not affect the project, because the masterplan was still fluid. She said: "We have not finalised the brief. It will be completed in light of discussions with Lambeth."
The commercial development proposed for part of this area is inappropriate
Lambeth council policy document
In a further blow to the redevelopment, London mayor Ken Livingstone supported criticism of the Jubilee Gardens element of the masterplan.
He said: "This is not desirable in strategic planning terms and will reduce the design options for achieving a world-class development of the Jubilee Gardens/metropolitan open land area."
The Greater London Authority, added, however, that the mayor was in favour of granting planning approval to the redesign of the South Bank because of its wider benefits.
Opponents of the scheme cheered Lambeth council's proposal. Waterloo Community Development, a local pressure group, said the moves sounded the "death knell" for Mather's masterplan.
