The controversial deal will see the council buy the land the cinema complex is situated on, and rent it back to a private international company.
The company will then use that money to pay for required earthquake strengthening.
The council says the deal is fiscally neutral, but those against it say it is a form of corporate welfare.
A motion to block the deal has failed, after nine councillors voted against it.
Earlier a wealthy Wellington property developer and philanthropist offered to buy the complex.
Sir Mark Dunajtschik's lawyer presented his plan to the council.
Lawyer Nick Wareham said Sir Mark would negotiate directly with Reading to purchase the land and offer it a lease.
"He will make payment to Reading for the land on a progress built completed basis, and he will contribute his funds after Reading have first invested their own money."
The rental proceeds will ultimately end up in Sir Mark's foundation, which would then gift the land back to Wellington citizens in 50 years' time.
If Reading wish to buy back the land prior to this gifting, they can negotiate to do so at market rates.
Ratepayers on track to get raw end of deal
Wareham said Sir Mark was urging the council not to go through with the current plan, saying "ratepayers are on the raw end of the deal".
He said the council would be risking ratepayers money up front, with no guarantees that the redevelopment project would proceed.
It would be putting ratepayers in before Reading did, affecting the amount of leverage the council had, he said.
"The council will simply be covering its costs of funds.
"It is unlikely that this will match a normal commercial ground rental and therefore the citizens of Wellington will not only be subsidising a commercial entity, they will also be foregoing a normal commercial return on land.
He said the deal could reduce the council's borrowing capacity.
Sir Mark and partner Dorothy Spotswood have donated more than $53 million to build the Wellington Children's Hospital, and has pledged another $50m to build a Mental Health Hospital in Lower Hutt.
RNZ
