They fear the Premier Inn proposed as part of the Borders Gateway development will take custom away from businesses in their home-town.
The original plans for the £12m development, billed as being expected to create around 100 jobs, were lodged in November and also included a BP petrol station, Marks and Spencer kiosk, drive-through Costa Coffee shop and a food store.
The food store was recently dropped from plans after developers conceded there is “no appetite” for it locally.
And while that news was welcomed at Melrose Community Council’s meeting last week, concerns remained that a budget hotel on the site would impact on the town’s own guest accommodation.
Community councillor Robin Chisholm said: “I am very worried that a 71-bedroom hotel that’s going to be full every night is 71 beds that are not going to be full in Melrose.
“The last thing we need is 71 bedrooms in Tweedbank which are going to suck the life out of businesses that people are trying very hard to develop in the High Street.
“Two hotels have just recently reopened, and people are trying hard to get back on their feet.”
Duncan Hamilton, representing Edinburgh-based developer New Land Assets, told last week’s meeting that Premier Inn is fully committed to the project and has already signed an agreement to that effect.
He said: “We have had an economic impact study done by independent consultants, and they see it having a hugely positive impact, bringing people to the area who will then go on to spend money in Galashiels and Melrose’s high streets.
“It’s a budget hotel with a different offering for a different customer base.”
Assuring councillors that the food store part of the proposals had been dropped for good, he added: “I think the message from the Borders has been very clear that they don’t want it.
“There is no appetite for a food outlet.
“We have listened to that message, and it’s very unlikely that we would try to put one there again.”
The Borders Gateway development proposal has so far garnered 180 letters of support and four objections, including one from Melrose Community Council.
Community council chairman William Windram agreed that Premier Inn might not be in direct competition with Melrose’s hotels and B&B establishments.
“I think most people agree that a budget hotel would be welcome somewhere in the Borders,” he said. “Whether this is the right location is another view.
“We have a number of hotels in the town because it’s a tourist town centre.
“Galashiels has fewer hotel remaining, and they are keen to have one in the centre of town.
“Anything that would bring a wider range of people to the area must be encouraged, but we may have differing view on where it should be placed.
“I think we all know the impact that these types of hotel have had elsewhere on attracting overnight visitors and short-stays.
“The difficulty here is people coming down by train. They’ll be reliant on public transport, and I am not sure the the linkage will be up to it.”
The council’s vice-chairwoman, Valerie Miller, added: “I would like to see this hotel in Galashiels instead. It’s Gala that needs an injection of spending and of visitors.
“Let Galashiels have the hotel that they so badly want and need.”
Concerns about increased traffic, loss of nearby trees and the height of the proposed four-storey building were also aired.
However, Mr Windram assured fellow councillors: “Clearly some of the concerns from people about the food store have been taken on board, but it’s still so far away from the local development plan that I cannot see Scottish Borders Council going for it.
“Just look at the most recent attempt to build a children’s play area at the old Barbour factory and how it got thrown out.
“The policy is fairly strongly defended by the council that they want this kept as an industrial area.”
Graham Barker disputed that view, saying: “Let us not forget that not so long ago the council was quite happy to put the tapestry building there, so nothing is set in stone.”
New Land Assets is hopeful that the application will go before Scottish Borders Council’s planning committee within the next few months.
If approved, it is expected that construction on the 5.68-acre site, formerly owned by do-it-yourself chain B&Q, would start this year.
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