Scarborough Borough Council’s planning and development committee voted through the application at a meeting today.
The scheme was put forward by Benchmark Leisure Ltd, which was the developer of Scarborough’s £14million Alpamare Water Park in Burniston Road.
The Premier Inn hotel will sit in the car park of the water park, behind a pub.
Over the course of two public consultations, 304 letters of objection were lodged with Scarborough Borough Council.
Six letters of support were also received.
A group, No to Premier Inn, was formed by local residents and guesthouse owners, who said the hotel would have a negative impact on the North Bay area and their businesses.
At the meeting at Scarborough Town Hall this afternoon, Kevin Lavender, speaking on behalf of local residents and Scarborough Hospitality Association, said there was an overwhelming number of objections.
He said: “The new hotel will add beds to an already saturated market.
“A one-stop-shop like this will mean that people will not venture into town as they will have no need to, drawing business away from the town centre.”
Jake Stentiford, on behalf of the planning agent, said the applicant had listened to concerns and reduced the height of the hotel in order to address those concerns.
He told the committee: “Any delay in a planning application like this can be fatal.”
He added that it would have a direct impact on the Scarborough economy to the tune of £1.7 million a year and create 30 new full-time equivalent jobs.
Cllr Neil Price (Lab) said the development was “out of scale, out of character and will not add to the tourism area of the North Bay”.
He added: “I question how this hotel is viable. As a former hotelier myself I know that the season stops in October and doesn’t pick up again until March. There may be some weekend visits but through the week it’s dead.
“There could be a hotel on this site but it would have to be much smaller.”
Cllr Eric Broadbent (Lab) added: “I should be welcoming this as I see the North Bay taking off over the next 20 years.
“We need a big hotel but this is the wrong place. Residential and business never mix, there are other sites in the North Bay where an even bigger hotel could go. I think Premier Inn is missing a trick.”
However, Cllr David Chance (Con) said that Scarborough needed the new hotel.
He added: “Scarborough cannot attract conferences in winter months as there is a dearth of accommodation.
“I am supportive of anything that is going to bring business into the town in the winter to support local jobs.”
The plans were approved by 11 votes to four, with one abstention.