Since proposals to demolish part of City's Royal Mile to make way for a £300 million project, campaigners have placed posters in shop windows in the Old Town showing dramatic "before and after" pictures of the buildings.

Now they have a champion in Jenny Dawe, the new Lib Dem leader of Edinburgh City Council, who yesterday described the new Caltongate development in the Canongate as "grotesque and hideous".

Ms Dawe said designs drawn up by Malcolm Fraser, one of Scotland's leading architects, were completely out of keeping with the World Heritage Site.

The proposed six-storey building which the developers Mountgrange want to build opposite the new council headquarters in Market Street would house shops, office space, a restaurant with a terraced cafe and a nightclub or bar.

Central to proposals is a "breakthrough" on to the Royal Mile, involving the demolition of a 1930s tenement block to make way for a broad footpath linking the Canongate with a new public square.

Eighteen homes in the Canongate will also make way for part of a five-star hotel and conference centre.

But Ms Dawe's comments are seen as a strong indication that a significant part of the plans will need to be redrawn.

Ms Dawe said: "I'm not anti-development. But I believe that any development must respect the heritage of the city. Malcolm Fraser is a very well known and respected architect and I was astounded to discover he was behind those images which appeared last week. The images were just grotesque and hideous.

"I would've expected someone of his reputation to produce something a bit more sympathetic to its surroundings, but they were pretty gross."

Ms Dawe also criticised Mountgrange for submitting a series of individual detailed plans for different parts of the development to the council. Separate proposals include 200 homes and a five-star hotel .

Mr Fraser said his designs would repair "19th-century vandalism", when part of a historic route between the Royal Mile and the top of Leith Walk was demolished to form Jeffrey Street.

Concerns have been raised that the proposed building would block some views down the Waverley Valley from both Jeffrey Street and Market Street.

Julie Logan, spokeswoman for the Save Our Old Town protest group, said: "It's a nonsense to say Jeffrey Street is incomplete, it's been deliberately left open like that, and there's nothing at all wrong with the way it looks."

Caltongate development
Edinburgh planning issues