OFFICES are to be demolished and replaced despite objections that the new taller block would "tower above" residents.
The plan sparked varying opinions, from a councillor saying it was "what we've been crying out for" to objectors saying it was "inappropriate", "overbearing" and "excessively large".
The Hanro Group applied for planning permission to demolish the former Mainstreet USA offices at St Cuthberts House, Diamond Terrace in Durham.
The two-storey building will be replaced by a new two to four-storey office block for up to 70 people.
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The plan, supported by Business Durham, was recommended for approval, a Durham County Council meeting heard.
Council planning officers said it would bring in investment and jobs, improve on the current building and it would be "transformative but will not harm".
But it attracted 12 letters of objection from residents and the Sidegate Residents' Association.
The objectors said the "unsympathetic" development would dominate medieval street Sidegate and "tower above" streets of Victorian houses, blocking out light and affecting views.
They also raised concerns over traffic congestion, parking, noise and air pollution.
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Susan Walker from the City of Durham Parish Council argued the "inappropriate" and "overbearing" proposed building would significantly change the conservation area.
She said: "This application should be refused without delay."
Ward member Councillor Richard Ormerod said it was an unsuitable commercial development which could harm "a village within a city".
The City of Durham Trust said the new building would harm a conservation area and world heritage site.
John Ashby from the trust said the building was "excessively large" with "grossly inadequate" traffic and parking arrangements.
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Hanro Group managing director Adam Serfontein said they had invested in Durham for more than 25 years and wanted to support small and medium-sized businesses and attract startups on a disused site.
He said: "We share in the success or otherwise of our region.
"We are in it for the long haul and wish to be a long-time partner in improving the viability and vitality of Durham.
"We wish to build quality, flexible, sustainable accommodation.
"I'm surprised at the vociferous objection to the potential creation of new jobs."
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Cllr Carl Marshall was in favour of the plan, saying: "We've got a proposal that actually meets a massive need.
"We need to create a suitable space in Durham. We need to retain the most talented people we can in the county.
"It's a highly sustainable sought-after location. It's within spitting distance of the east coast mainline.
"For me there's an absolute massive demand for this. I think we would be doing a disservice to the county if we weren't in a position to approve it.
"This is what we've been crying out for."
Councillors voted to approve the plan.
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