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The council's hearings committee yesterday released a written decision granting consent for the new caravan park at 51, 55 and 57 Woodhaugh St.
The park would be owned and operated by the New Zealand Motor Caravan Association, and cater for some of the association's 48,000 members, with a dump station on site.
Consent conditions included the realignment of the nearby intersection of Woodhaugh and Malvern Sts, at the association's expense, to ensure caravans up to 13m long could negotiate the corner and reach the site.
The proposal attracted opposition from neighbours, but limited notification meant only seven submissions were considered at a consent hearing in May.
Among those deemed not to be affected parties, and whose views were therefore not considered, were Terry and Lyn McLaren. The couple own the Leith Valley Touring Park just 30m away and have a home overlooking the site of the new park.
Yesterday, Mr McLaren told the Otago Daily Times the decision to grant consent left him feeling like he had been ''kicked in the guts''.
''The council is just trying to ruin our business. Motor camps [across the city] have spent millions of dollars building up their grounds ... and we're just getting kicked in the guts by the council.''
Mr McLaren had tried to interject during May's consent hearing, but was told he would need to seek a judicial review of any decision that followed.
Lyn McLaren was even more blunt about the decision yesterday: ''I think it's crap.''
''All the neighbours in that area - none of them want it, but they've all been out-voted.
''How can they do that? But obviously they can, because they're the council.''
The couple hoped the new park next door would not hurt their own business, which was now for sale, Mr McLaren said.
The written decision by independent commissioner Allan Cubitt said the committee conducted a site visit after the hearing adjourned and was now satisfied ''suitable conditions'' would minimise any disruption to the area's character.
The realignment of the nearby intersection would also solve any road safety issues, the committee believed.
Among the 14 conditions imposed were others limiting vehicles to stays of no more than seven nights in a row each month, landscaping to shield the site from view, restrictions on the use of generators and a 13m limit on the length of caravans visiting.
However, Mrs McLaren remains concerned about safety at the intersection, while Mr McLaren said the council was only interested in selling its land.
Another submitter, Rhonda Taylor, said yesterday she had not decided whether to appeal.
She had claimed during the hearing the council had a ''vested interest'' in granting consent. The council had agreed to sell the land to the NZMCA, but the conditional deal was subject to consent for a caravan park on site being granted.
Mr Cubitt, who replaced usual committee chairman Cr Colin Weatherall at the last minute, denied that, telling the hearing Mrs Taylor's claims were ''precisely why I am here''.
''I am here to ensure that there is impartiality.''