Plans for a £7.8m five-storey hotel in Abersoch, North Wales, have been turned down by local authority planners over the developers’ “inadequate” offer of £150,000 for social housing.

The planning application, submitted by Manchester-based developers Broomco, would have included a 42-bedroom hotel, 18 apartments, a restaurant, spa and conference facility. Broomco intended to demolish and replace the site’s existing White House Hotel.

The development policy for local authority Gwynedd, dictates that developments must include 30 per cent towards social housing. This means the local authority would expect six of the 18 proposed apartments to be for social housing, or to have the cash equivalent to build a similar number of “affordable units” nearby,.

The planning application vote was deferred last month to allow Broomco to increase its offer.

Economic benefits of the proposed hotel would have included a boost to the number of hotel rooms in the popular holiday resort by 25 per cent, leading to the addition of £1.5m to the local economy and the availability of up to 120 jobs at peak season.

But the authority’s final report concluded, “The provision for affordable housing as a part of this development is unacceptable and that this consequently outweighs the economic benefits that would arise from the development.”