Councillors have objected to a second set of plans to turn the site of the former Salvation Army hall into a 36-bedroom budget hotel.
Maiden Properties wants to build where the former church meeting hall stood in East Street, Stamford.
But Stamford Town Council’s planning committee has come up with a series of objections to the proposal.
Committee chairman Harrish Bisnauthsing (Lib Dem) said councillors had listened to the concerns of neighbouring residents.
He added: “It’s going to affect the privacy of the residents behind and adjacent to it. From the second floor you would see all the back gardens.
“There is also a concern regarding parking. There will be 36 bedrooms and 18 parking spaces. Two are disabled.
“There is also a concern about emergency access.
“But the main concern is that North Street is very busy, especially in the morning and afternoon. Extra cars are going to cause severe congestion.”
Coun Bisnauthsing added: “We could do with a budget hotel but not in this location.”
Maiden Properties’ application is the second of its kind on the site. The first set of plans were withdrawn in March last year amid concerns over the size of the proposed building and potential parking problems.
The latest application, submitted in January, aims to address those problems. According to a report by architect Jeff Brabban, of Boyce Associates, privacy would not be an issue.
Mr Brabban wrote: “Consideration should be given to the purpose use of the proposal (unlike residential occupancy), in that the occupants, tourists and possibly some degree of business user, would be vacated by day, possibly take an evening meal and return to retire.
“It is therefore considered that there is a very low potential for privacy issues.”
The plans include basement parking, with the current access from East Street retained.
According to the plans, 18 spaces would be enough given the proximity of the hotel to the town centre. Cycle storage would also be provided.
And a lay-by would be installed to allow guests and supplies to be dropped off.
The plans can be viewed online at www.southkesteven.gov.uk.