A community leader has welcomed the rejection of a plan to convert listed buildings on an historic Yorkshire Dales estate into a luxury apart-hotel and wedding venue.

Government inspector Frances Mahoney has dismissed Rural Heritage Property Ltd’s appeal over its proposal to transform ten apartments, the basement at 17,000sq ft Marske Hall, its historic kennels and a sawmill, with facilities ranging from a gym and sauna to wine tasting rooms.

The decision comes more than two years after the Yorkshire Dales National Park Authority refused it following an outcry among residents in the village over the potential disturbance the scores of guests at Marske Hall would cause.

It had also been also proposed to utilise the extensive formal landscaped garden of the halls, which was bought in 1596 by Archbishop of York Matthew Hutton, and woods for activities such as archery, bowls and croquet.

Marske, a stallion owned by his descendant John Hutton, who added the estate’s stableyard, sired the legendary Eclipse which is linked to 95 per cent of the world’s thoroughbreds.

The developers argued the hall had a long history of hosting events – in the 19th century it was mainly used by the Huttons for shooting parties and highlighted the proposed venue could provide an important facility for local residents and visitors.

In the appeal the firm also stated how the plan would give the site a new lease of life, preserving heritage assets for future generations with past unsympathetic interventions being made good.

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It was argued the scheme would provide “a small-scale, well-designed tourist use which would conserve the landscape character of the locality by respecting its sensitivities”, increasing the amount and quality of tourist accommodation within the national park.

Nevertheless, the inspector found Marske Hall and its estate buildings made an important contribution to the character, appearance and quality of the valley in which the village sits.

She stated: “The proposed use for events would undermine that contribution by reason of the noise and activity in and around the kennels and sawmill which would diminish the rural character of the tranquil valley which is central to the significance of the listed buildings.”

She concluded the loss of historic fabric, the dominance of the proposed car parking and the resultant noise generated by the proposed event spaces would not preserve the setting of the listed buildings or enhance the character and appearance of the Marske Conservation Area.

She said: “I have considered the appellant’s proffered argument that Marske Hall in its heyday would have been a place of welcoming guests of the family, of socialising and of parties. The activities of the occupiers of the hall centuries ago does not now justify the use of the sawmill and kennels as proposed, as some recollection of a society which is generally unrecognisable in our modern day nation.”

The park authority’s head of development management Richard Graham described the decision as “a particularly welcome judgment” due to the level of disturbance it would have generated.

Lower Swaledale and Arkengarthdale councillor Richard Good said he welcomed the decision as it was “very much the will of residents of Marske that this development did not go ahead”.

He said a recent parish council meeting had heard residents state the last thing they wanted was for the hall to remain unused and its fabric deteriorate.

Cllr Good said believed there was a viable alternative way of preserving the heritage assets due to the village’s proximity to Richmond, and that modernised flats at the hall would be in high demand.

He said: “It has been a long process and despite having done everything correctly the parish came under a bit of stick initially. The main concerns were the noise, the parking and the disturbance to trees, and the inspector has supported the park authority’s decision on all those matters.”