Developers have submitted new plans to build flats in St Leonards which could see historic Victorian workshops demolished.
The scheme involves building 13 apartments on a triangle of land at the junction of St Peter’s Road, Cornfield Terrace and Tower Road.
The proposals have sparked opposition from residents, with scores of people signing a petition in protest.
A similar proposal was submitted to the borough council in November last year, which attracted objection.
Lead petitioner, William Third, said: “We are aware of the desperate need for new housing, but the proposal seeks to jam too many people into this already overcrowded area with its delapidated pavements, pot-holed roads, clogged up drains and sewers, one which runs under Christ Church School and under the site at 35 Tower Road.”
Mr Third, John Humphries and Vivienne Fox set up the Tower Road Protest Group last year to fight development of the site.
Resident Heather Grief said: “The proposal will remove jobs and workshops from the local area. The increase in traffic to an already dangerous area, next to a primary school, will be intolerable and will lead to more accidents.”
A report by John D Clarke Architects, representing the developers, which has been submitted to the council, said: “In light of the poor condition of the existing buildings, inefficient rents and the historically rapid turnover of occupiers for the majority of the site, it is intended to redevelop the site and provide new buildings for residential use.
“The proposals will provide a well considered, uniquely architectural and sustainable new building design, providing 13 high quality apartments.
“The scheme will also provide the site with a sustainable model in terms of consistency of use, financial stability and energy efficiency.”
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