LANS to develop a 64-bed secure mental hospital have been approved by councillors.
The development, on the site of the former Sedgefield Community Hospital, is expected to bring more than 210 jobs to the area.
The application, submitted by Care Principles, was approved by Sedgefield Borough Council's development control committee yesterday.
A decision had been expected on June 5, but it was deferred when the council received a letter of objection at the 11th hour.
It was submitted by Leith Planning on behalf of unnamed clients who were "concerned psychiatric care and rehabilitation facilities are constructed and operated to recommended standards".
But yesterday, the council's planning officers told members there was no indication that the facility would fail to meet proper standards and the objection had an element of commercial
Richard Broughton, for Care Principles, said the objecting planning consultants were connected with a competitor of Care Principles.
He said: "Leith Planning and their subsidiary Planning and Licensing Objections UK has submitted very similar documents to that compiled for the Sedgefield project in respect of at least four
competitor organisations in the recent past for healthcare services totalling in excess of 200 beds."
The facility will be made up of four single-storey houses, each with 16 single bedrooms linked to a central hub with treatment rooms and dining areas.
Three of the houses will be surrounded by a 5.2-metre fence and the fourth, lower-risk house, will have a two-metre fence.
It will provide care for up to 64 adults with learning difficulties, personality disorders or autistic spectrum disorders.
No one from Leith Planning was available for comment last night.