Hotel giant Premier Inn is to appeal against the rejection of its plans for a £10 million budget hotel for the centre of Bath.

At a meeting of Bath and North East Somerset Council's development control committee yesterday, councillors voted against the application for a 108-room Premier Inn in James Street West.

The application, by MDN Properties, was to knock down the Bath Carpet Warehouse building on the corner with Kingsmead North, and replace it with a five-storey hotel, bar and restaurant.

It would create around 50 jobs, but there would be no car park.

Councillors were concerned that the hotel - one of four planned for the same part of the city centre - would generate too much traffic in James Street West, as taxi drivers drop guests off.

The decision was hailed as a victory for common sense by guest house owners, but Premier says it is confident of its case at an appeal.

Councillor David Martin (Lib Dem, Bathwick) said: "I support comments made about the amount of traffic this hotel will generate.

"We will see a lot of vehicles coming along the street to the hotel causing problems.

"I feel it an inappropriate position for a hotel of this size."

Councillor Douglas Nicol (Lib Dem, Kingsmead) said: "This application is detrimental to the local economy and it will damage local hotels.

"I do not want this hotel, and the residents do not want it."

The Bath Independent Guest Houses Association led opposition to the application, saying the budget hotel would flood the market with rooms that were not needed, and cause major traffic problems.

BIGHA chairman Les Redwood spoke at the meeting to register the group's opinion.

He said: "What our city needs is a diverse offer, not a flood of cheap bed space.

"These budget hotels damage the unique high quality accommodation that we are lucky to have in Bath, and will just flood the market with an overcapacity of cheap rooms.

"To put yet another budget hotel operator in the centre of Bath is another nail in the coffin of our unique selling point that we are not a clone city.

"Add to this the fact that guests will be directed to this site with little parking, even to drop off, and you will have a recipe for traffic chaos."

Councillors voted nine to three to refuse the application.

They had been recommended to delegate approval to officers, who had warned that the planning system should not be used to restrict choice, despite the findings of a £37,000 visitor accommodation study that stated there was only a limited need for extra budget accommodation.

There are also plans for hotels at Kingsmead House, Green Park House and the Gainsborough Building.

Mr Redwood said: "This is a victory for some common sense at last."

Richard Pearson, acquisition manager for Whitbread Hotels and Restaurants, which owns Premier Inn, said: "Premier Inn is an award-wining business and a trusted brand with 600 hotels across the UK contributing to their local economies.  We are passionate about our plans for Bath and we believe our investment will significantly enhance James Street West.  We are capable of delivering a good quality, affordable accommodation option for Bath and we intend to appeal the decision."

David MacMullen, director for consultants MacMullen Associates, said: "We are committed to bringing Premier Inn to Bath.  We are confident in the strength of our application and we will appeal the council's decision.  Our proposals are sensitive to the city's architectural heritage and will deliver a first class result for James Street West.  Premier Inn will bring jobs and investment to Bath and will reinvigorate this tired corner of Kingsmead Square."