The green light has been given for the council to build a major housing development at Hoofields in Lerwick.
The decision at a hearing in the Town Hall means 32 of the existing chalets in the area will be taken down and replaced by 76 new houses.
However the move means land owned by the SIC will have to be found to provide outdoor lairage for the marts, which lies close to where the scheme will be.
Members of the council’s planning committee were told the development encroached onto land used by Shetland Livestock Marketing Group (SLMG) to keep up to 5,000 lambs during sale days.
Chairman Ronnie Eunson told councillors government vets had advised the group it should not operate below the hectorage it currently has.
“If land was removed from the current lairage we would look to the SIC to replace it with an equivalent area,” he said.
The council’s contracts manager, Neil Clubb, said efforts were underway to secure a new patch of land which could be given over to lairage once the houses are built.
However Mr Eunson was still concerned residents may complain about the level of noise on days when the marts are operating.
He was also worried dog-owners may fail to keep a lead on their pets, which would then be left free to go and worry the animals.
Only 32 of the new houses are planned for the existing chalet site. The remaining 44 are scheduled to be built on what the council terms as “zone four” – in other words, sparsely populated areas with the bare minimum of development.
Secretary of the North Staney Hill Community Association John Bulter was also concerned the number of one bedroom units was disproportionately high.
The new buildings will comprise a mix of 28 one bedroom flats and 16 one bedroom houses, along with 22 two bedroom houses, eight houses with three bedrooms and two with four.
“We feel this is not creating a healthy, balanced community,” he said.
The committee heard most of the housing demand, however, was for one bedroom units.
Head of housing Chris Medley pointed to the innovative design process being adopted for the houses, which will allow second bedrooms to be added as family needs change.
Lerwick North member Caroline Miller moved the application be approved.
She was seconded by Cecil Smith, who said the need for social housing was too big to ignore. “We can’t delay this. We need to get this underway,” he said.
The question of what to do with the old chalets was raised by south end member Jim Budge. Mr Medley said the units were in various states of disrepair.
However he said he had been “inundated” with enquiries from people looking to acquire them.