Papers have been lodged with council planning officials confirming plans by Edinburgh Accies to redevelop its existing sports ground at Raeburn Place, Stockbridge.
The club, which was established in 1857, wants to build a sports stadium holding up to 5000 people, as well as a clubhouse and space for shops, bars and restaurants.
Club bosses said the development would provide new facilities for local people and sports fans across north Edinburgh.
However, small business owners and residents in Stockbridge said the revamp would damage Stockbridge’s distinctive character and independent traders by attracting only large chains.
James McLean, who lives opposite the proposed development, said: “At the last Stockbridge community council meeting, one of the residents described it as the Death Star of Stockbridge.
“There are 19,000 square feet of new retail planned and we in the local community have concerns that’s an awful lot of retail space. It’s okay to have a rugby development with changing rooms and sports facilities – we would support that.
“But I feel that they are just disguising the retail units.
“The shopkeepers round here are very worried. Most of them are very small and I think this will put most of them out of business.”
Andrew Firth, owner of Herbie of Edinburgh delicatessen in Stockbridge, said: “As far as the traders are concerned, we are worried about the size of the development and the size of the units underneath the stadium.
“Stockbridge is one of the last villages left in Edinburgh, and we are quite protective of that status.
“But it’s slowly becoming like any other British high street. There’s the fear that most of the units will be taken by national chains.
“Obviously, the Accies want revenue – without it the club cannot survive – but there’s a certain amount of, ‘let’s have a massive vision and go for it and, oh, where’s the money coming from?’
“We have a game butcher in Stockbridge but we used to have four and now it’s all coffee and charity shops. It’s becoming a greyer street and I fear that will be speeded up by this development.”
However, Accies bosses dismissed fears over the development’s impact on local businesses.
John Wright, club secretary, said: “I think there’s a bit of scaremongering over Tesco taking over and parking and so on.
“Only five per cent of the development is for retail – it’s not an overbearing thing.
“The development helps to keep the sports club running with the work it does at the junior and the senior levels throughout north Edinburgh.
“It means that the ground stays as a grass sports facility which can be used for the benefit of residents of Stockbridge, and it will have a positive effect on the area as it will offer more facilities to attract people here. It will enhance the area’s viability.”
Councillor Gavin Barrie, SNP member for Inverleith, said: “It’s early days – there will be people for and against this and, in due course, everyone will have the opportunity to put their point of view across.”
A full planning application is expected to follow soon.