Colburn Town Council (CTC) has launched a campaign to prevent houses being built on Colburn Business Park.
The move comes after a consultation was launched by Linden Homes which wants to build 92 houses on the park on Chartermark Way.
Councillors say they have already met with businesses and Richmondshire District Council to discuss how they can safeguard the land for business use.
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The council says they are concerned that if housing was permitted on the park, businesses would choose to move to alternative locations outside Richmondshire.
They said in a statement issued today: “(This is) extremely worrying as the original concept of the park was that local people would be employed locally.
“There would be a loss of jobs. Any potential loss of jobs is concerning for local residents and totally unacceptable.”
The council said that since the upgrading of the A1 had started, there had been increased interest in the business park, with some existing businesses having expressed a wish to expand.
The authority added: “There has been interest from other companies but there is now concern that they will not wish to come.
“It is the opinion of Colburn Town Council that when the A1 is completed the land within the business park will be a prime location for additional businesses and allow economic growth within Colburn.
“Now that the park has become an attractive proposition CTC does not want it to be overtaken by yet another housing development.”
The council said that currently the business park was home to a wide range of business sectors “using much needed office space” and it was important that the area was able to offer diverse employment opportunities on this unique site.
“Residential development continues at pace within Colburn and the area needs a range of good quality businesses and employment opportunities in order to expand at a rate that is sustainable; provides and supports the local economy and infrastructure,” it added.
“Councillors are very concerned that Colburn is becoming a dormer town and that its identity will be lost.”
The council is urging residents, employees and businesses to attend the forthcoming consultation event being hosted by Linden Homes being held on Thursday, November 23 at Colburn Leisure Centre between 3pm to 7pm.