Residents fighting the construction of what has been billed as “one of the most important buildings to be constructed in Hampstead in recent years” have suffered a serious defeat tonight after councillors awarded it planning permission.

Camden Council gave the go-ahead for a £42million seven-storey research centre – backed by prime minister David Cameron and Mayor of London Boris Johnson – to be built at the site of an existing hospital car park on the edge of Hampstead Green in Rosslyn Hill.

The project, which will house the UCL Institute of Immunity and Transplantation, will accommodate 200 researchers and a two-storey patient hotel.

Scientists say the new building will become Europe’s leading research hub in immunology, infection and transplantation, “transforming the lives of patients locally, nationally and globally”.

But the project saw significant opposition from hundreds of neighbouring residents in Hampstead concerned about the planned building’s visual impact, the loss of green space, traffic congestion and a perceived overdevelopment of the area.

The site of the development is also adjacent to Grade-I listed former church St Stephen’s, now a venue for events, concerts and weddings.

Serious concerns have been expressed by those in charge of St Stephen’s about the impact construction could have on their building.

Michael Taylor, chairman of St Stephen’s Trust, said his organisation would appeal the council’s decision.

After this evening’s planning meeting at Camden Town Hall in Judd Street, he told the Ham&High: “We will instruct our lawyers to go for a judicial review.

“Tonight’s discussion by councillors was trivial and pushed to one side the serious issues at hand.

“The council overlooked the major risks that threaten St Stephen’s as a result of this project.”

Along with almost 300 local residents opposing the development, among those objecting included the Victorian Society, the Ancient Monument Society, Hampstead Hill School, St Stephens Restoration Trust and the South End Green Association.

Among the 76 in support of the proposals were MP for Hampstead and Kilburn Glenda Jackson, the prime minister and the Mayor of London.

Councillors accepted the recommendation of council planners and unanimously approved the planning application.

David Sloman, the chief executive of the Royal Free London NHS Foundation Trust, said: “I am delighted that planning permission for the Pears Building has been granted.

“The new building will bring huge benefits to patients, including providing on site accommodation for out-patients who live far from the hospital.

“Research being carried out at the IIT will bring benefits to patients across the world as new treatments for cancers and immune-related conditions are developed.”

Chris Burghes, the chief executive of the Royal Free Charity, added: “This is great news for patients at the Royal Free London. We have employed high calibre architects to design this building so that it reflects the architecture of the surrounding area and we aim to ensure this will be a building that everyone in Hampstead can be proud of.”

Professor Michael Arthur, UCL president and provost, said: “Over the last half century, UCL and the Royal Free London have made major breakthroughs in the fields of transplant immunology, immunotherapy, and autoimmunity. These breakthroughs occur when researchers and clinicians can work together, and are the result of having the right people, from the right disciplines, with the right knowledge, together in the right place. In future, that place will be the IIT. Camden Council’s decision to approve the Pears Building is a significant milestone in the delivery of our ambitious shared vision.”

See next week’s Ham&High for a full report.