As chief executive of the Glasgow East Regeneration Agency (GERA), Ronnie Saez named the restored Blairtummock House in the city's east end after Labour's Jim Coleman.
Opposition councillors questioned the decision as Coleman was one of the trustees who two years later agreed Saez's "extremely generous" payment.
The Office of the Scottish Charity Regulator (OSCR) last week issued a scathing report into Saez's severance payment, which he received in 2011 as GERA was being wound up.
Three of the five trustees who signed off the deal were Labour councillors: Coleman; George Redmond; and Catherine McMaster.
In 2009, more than 100 guests were at the launch of the revitalised Blairtummock House, a council-owned building that GERA helped transform into a business facility.
According to the Blairtummock website, Saez made a presentation and "paid tribute" to the "lifelong efforts of local Councillor James Coleman", after which he "dedicated the new centre to him".
Glasgow Tory councillor David Meikle said: "It is clear there were ties between Coleman and Saez, therefore it was inappropriate for Coleman to have taken part in any discussions regarding Saez's payoff."
Graeme Hendry, the SNP group leader on the council, said: "It would surely have been sensible for Councillor Coleman to exempt himself from any decision to award an unnecessary and extremely generous financial package to Mr Saez."
Coleman said "no connection whatsoever" should be drawn between the centre dedicated to him and his role in the Saez pay-off.