Sinn Fein's Ciara Ferguson has welcomed a decision by the Derry councils' planning committee to approve a new social housing development close to the Buncrana Road.
The MLA candidate for Foyle said it would help to further meet the huge demand for social housing in the area.
Gravis Planning obtained planning from the local council's planning committee on last week, despite local residents in the area raising their concerns.
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Residents from properties in College Glen, College Mews, Templemore Mews and Donal Casey Court submitted 27 objection letters to the council.
A total of 98 new homes are set to be built on the currently derelict site adjacent to Faustina Retail Park, which currently is home to retail stores The Range, Poundstretcher and Dunelm.
An objection letter was also received from a consultant on behalf of Threadneedle - the owners of Faustina Retail Park.
Concerns were raised about the land being re-zoned for residential properties rather than retail. The land was zoned for retail in 2011 and Tesco had previously applied to build at the site.
However, Ms Ferguson said the development would provide "much needed new homes for scores of local families".
She said: "I am delighted that the Planning Committee of Derry & Strabane District Council granted this application for 58 houses and 40 apartments.
“It will further address the huge demand for social housing in the Shantallow area and also see the development of a piece of land that has long lain derelict beside the Faustina retail park.
“I am also pleased that the conditions of the planning permission have taken into account the proposed dualling of the A2 Buncrana road to ensure that both projects are fully aligned.
“This development will provide much needed new homes for scores of local families which is a key priority of Sinn Féin"
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