An East Devon charity's proposal to knock down its community centre and replace it with flats has been rejected by East Devon District Council (EDDC).

Ottery Feoffee Charity in Ottery St Mary wants to demolish its centre and replace it with six flats to be let out at affordable rates.

Debating the application at a planning committee meeting, councillors recognised the desperate need for affordable housing but concluded that the plans put forward by the charity fell short in some respects. They argued that the proposed building would be at risk of flooding and that mitigating this by building it higher would add to the negative visual impact of the large development.

It was pointed out that the building would be contrary to the neighbourhood plan, which "strongly resists" the loss of community centres of value.

It is unwelcome news for the charity, which helps people in need in Ottery St Mary. It says it is struggling to pay the costs of maintaining the community centre and that replacing the ageing timber structure is unaffordable.

Speaking at the planning committee meeting, chair of Ottery Feoffee Charity Diane Passey said: "Although it is accepted that the removal of the centre means the loss of a community facility they [the charity's trustees] consider this is more than compensated for by the building of more affordable accommodation for the community."

The charity currently lets several flats nearby for just £50 per week including utilities. But demand for more affordable housing in East Devon is going unmet: a recent report from Devon Home Choice found more than 2,300 households in the district are in housing need, the third-highest in the county.

Councillor Geoff Pratt (Independent Group, Ottery St Mary) said: "Members of the council and members of parliament and councillors up and down the country are screaming for affordable housing for communities to be provided and this is an important issue that needs to be dealt with.

"There is every need for this development to go through."

Other councillors sympathised with what the charity was trying to do, but concluded that the plans weren't up to scratch.

Councillor Peter Faithfull (Independent, Ottery St Mary) said he supported the work the charity does but was worried about flooding: "The name, Brook Street [where the community centre sits], tells you pretty much what happens there – it floods.

"This particular application I find rather overbearing for the site."

Councillor Mike Howe (Conservative, Clyst Valley) added: "It's one of those where you want to support a charity but in this respect the charity has just not done enough. There are too many policies this is against, too many question marks over it."

Cllr Howe said he hoped the charity would take another look at its plans and make the proposed building smaller and take it out of the flood plain completely, concluding: "There is an opportunity for the charity but this certainly isn't it."

Ottery Feoffee Charity is a medieval organisation dating back to 1440 when land was bequeathed to 12 trustees for charitable purposes. It became a registered charity in 1970 and in the same year acquired the community centre, originally built by the Devon County Council educational authority as a temporary classroom for a nearby girls' school.