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A flagship project that could create 3,500 jobs is under threat.

The developer behind £650 million plans for Chatham Docks has warned that a decision to reject the first phase has placed the whole project in jeopardy.

In the wake of the decision, James Whittaker, Peel Land and Property’s development director, told the Medway Messenger: “We might not be able to deliver any of the development – full stop.”

Peel wants to turn 26 acres at the site in Pier Road, Gillingham, into a complex containing student apartments, homes, office space, shops, university facilities and a conference centre.

The first part, rejected by the planning committee last week, included an Asda, petrol station, car park, pub/restaurant and a park.

At the meeting, councillors claimed, among other things, that the buildings would not complement others nearby and that there was no consistency to the design of the buildings proposed.

They also questioned the lack of a hotel, which was removed from the original plans, claiming there was urgent demand for rooms.

The general consensus was that the proposal was underwhelming.

Mr Whittaker said the events of last week meant the future of the project was now “out of my hands”.

Asda and Marston's, the company that would run the pub/restaurant, were integral to the development and are now assessing whether to continue, he claimed.

Mr Whittaker confirmed Peel will appeal, a lengthy process which could take up to nine months.

It could be costly as well.

If the council loses, it might have to foot the bill, which Mr Whittaker claimed could total more than half a million pounds.

He dismissed councillors’ objections to the first phase, labelling them “all completely wrong” and “complete nonsense”.

He said: “They have jeopardised all those jobs. If I was a local, I’d be extremely upset.”

Mr Whittaker revealed the council’s planning officers had told Peel to remove the hotel from the plans and added the claims of high demand were not based on reality.

“The Encore [hotel, in Chatham] objected to our proposal because their numbers are very low and they said if there’s competition they may go out of business,” he said.

Peel had hoped to begin work in September and finish the first phase in early 2015.

Councillors have accepted building on the site in principle, granting outline planning permission last year.

At that stage they agreed what type of facilities should be in the site’s four zones and the maximum height of buildings.