The sight of an excavator before the work begins causes uncertainty, but the site foreman informs the council that it is a precautionary measure in case of collapse of the unstable Macklin Street wall.
They also reveal that they are considering prosecuting him for illegal demolition.
The fire was later said to be arson
The appeal would mean a long and costly battle for the council. They instead decide to work with him to find new uses for the building.
The city council pursues legal action for the damage caused to the theatre.
Mr Anthony's plans to turn the Hippodrome site into a car park with some housing are also submitted to the city council.
His desired sale price is £1.2m, the sum that he had spent on the building.
Charges against Mr Watson are dropped and it is accepted that Mr Anthony did not deliberately cause damage to the building. A probe into his finances is sentenced.