Exclusive apartments could flank Ulverston's canal if plans from a Rochdale developer are approved.

Hallmark Developments has submitted an outline application to South Lakeland District Council to build 30 homes on the site of the derelict Furness Paper Mill at North Lonsdale Road.

"It's a mixture of mews-type houses and apartments with one and two-bedroomed units in the vernacular style," said Hallmark's Christopher Grieves.

"It's an exclusive development but the price will start around £75,000 upwards; most of them will have a canal front."

Ulverston estate agent Ralph Spours greeted the plans with enthusiasm, and said there was an "insatiable demand for good-quality housing" in the town, reflected in rapidly rising house prices.

But Ulverston Town Council raised concerns this week and recommended that SLDC reject the application.

Coun Bob Bolton said approval of major housing development could not be considered until the junction between North Lonsdale Road and the A590 was improved.

He said this objection was also true for development at nearby Lund Farm, a site separated from the canal by North Lonsdale Road, which is designated in the Local Plan for housing.

Coun Stan Lewis believed the site, which is currently considered employment land because it is on the site of the former paper mill, should not be given over for housing.

Coun Bolton agreed: "There is a concern across the district about the loss of employment sites.

I think times have changed and this should remain as an employment site, albeit what type is questionable."

SLDC planning officer Kate Lawson said the district council would have to decide if it wanted to keep the land for employment or release it for housing.

"The council is keen to regenerate along the canal and improve it, and a development like this is maybe a way of doing that and ending up with mixed uses on the site."

Mr Grieves said Hallmark considered the land alongside the 1.25-mile canal as a brownfield site suitable for housing.

"This is the sort of site which the Government is promoting for this type of development," he said.

Consultations on the plans are being held with environmental health officers, since there are likely to be contamination issues on the old industrial site, and with the highways agency which will advise on concerns about access.

SLDC's development control committee is due to rule on the application on July 30.