Plans for more than 200 new homes have been recommended for refusal after the developers failed to provide a sufficient level of "affordable" homes.
The proposals for St Catherine's Place shopping centre in Bedminster, Bristol would also include retail, leisure, and "commercial space" including a cinema.
But city planning officers say the design is "unacceptable".
Developer Firmstone said it was "deeply disappointed" and had created a "balanced...mixed-use scheme".
A spokesman said the company wanted to "overhaul the shopping centre, improve public spaces and connections to the surrounding area and provide a real focus for the local community".
"The [St Catherine's Place ]shopping centre is very run-down and requires major investment to provide the step-change that's needed to transform the East Street area, which is known to be struggling," he added.
The development would see five residential blocks, the tallest of which would be 16 storeys high, with commercial/retail units in the ground floor of four of them.
It also plans to have parking for 347 bicycles and 27 cars.
But many who live in the area said the scale of the development was "out of character with the local area" and it would have an "overbearing" impact on the local community.
Firmstone said their original plans had been altered in response to local feedback.
"The height of the tallest building has been lowered substantially from 22 storeys to 16 storeys," the company said.