A Sydney landlord is attempting to squash a Brisbane development in order to protect its profits, a major developer has claimed.

Seymour Group's comments come in response to the Sydney-based asset group Dexus attempting to block its development in the Queensland Planning and Environment Court.

The 15-storey project, dubbed Newstead Green, includes plans for 800 apartments, shops, a Coles, offices, and a "green spine" of public walking paths.

The proposal was approved by Brisbane City Council, but Dexus is attempting to overturn that decision, citing harms to the neighbourhood character and worsening traffic.

In a Notice of Appeal to council, Dexus claimed its nearby shopping mall, Gasworks Plaza, would lose more than 15 per cent of sales if Newstead Green went ahead.

Seymour Group director Daniel Farquhar said he believed Dexus was trying to stifle competition. 

"You've got landlords slowing down development and competition in this [supermarket] sector," Mr Farquhar said.

"There are other developments going on in Newstead some of which are impact assessable … Dexus hasn't appealed any of those.

"If it was about anything other than competition, I don't know why they would be bothering."

Plans 'inconsistent' with area's character, Dexus says

A Dexus spokesperson told ABC Radio Brisbane the Newstead Green plan would harm the amenity of the neighbourhood.

"Traffic congestion is already a major issue for Newstead which will be exacerbated by a new shopping centre of this size," the spokesperson said.

"The proposal is also inconsistent with the character of the neighbourhood and there is a risk Newstead will lose its identity if this development was to proceed as currently planned."

The proposed development failed to meet council's planning scheme requirements as laid out in its City Plan 2014.

The area is classified as a low impact industry zone, and was historically the site of timber yards, asbestos factories, and woolstores. 

Housing in demand

However, it was still approved by Brisbane City Council on the grounds it would create much-needed housing and jobs for the area.

Council's Decision Assessment Report noted the development would connect the CBD, Fortitude Valley, and an emerging Olympic Precinct.

"It is acknowledged the proposed development does not align with the current City Plan 2014 requirements applying to the site including land uses and built form outcomes," the report reads.

"On balance, sufficient justification has been provided to support the variation request subject to the conditions imposed.

The proposal provides additional housing options to address population growth, while ensuring a range of specialised business, retail and supporting service uses.

Mr Farquhar said the appeal would likely take several years and millions of dollars in legal fees for all sides.

He said it would also cost Brisbane ratepayers, since council would need to hire its own lawyers to defend the decision in the Queensland Planning and Environment Court.

"It really is a very slow and expensive process," Mr Farquhar said.

"If you spend, call it $3 million by all parties, how many apartments could that build?"