The announcement was made at masses on Sunday by Fr Michael Cusack, Adm St Joseph’s.
An open evening will be held this (Tuesday) evening at the parish room in the monastery to outline the planned refurbishment and development.
An application for planning permission is expected to be submitted this week.
The monastery was built towards the end of the 19th century.
The Redemptorists came to Dundalk in 1876 and established a monastery firstly in Park Street, and then on St Alphonsus Road, then known as Windmill Road.
The missioners, as many local people called them, became household names when, in 1892, the beautiful church of St Joseph was built.
St Joseph parish was created in in February 1976. The parish now has over 1,700 homes with over 4,813 of a population. The parish area includes Lisnaree, Cluan Enda, Oaklawns, Meadow Grove, St. Alphonsus Road and the Villas, Barrack Street, Quay Street, Hyde Park.