Liverpool Council leaders have approved plans for a lap-dancing club in the city’s gay quarter, despite local objections that it may lead to conflict between the straight and gay communities.

The venue, which is to be called Paradise and will reportedly have a gay manager, obtained permission to open on Stanley Street, Liverpool’s official gay quarter.

Members of the LGBT community said that a venue aimed at straight men was wrong for the area, was likely to lead to an increase in hate crimes, and would undermine the entire point of having a gay quarter.

Lawyers acting for the venue rejected these claims. They pointed out that, if a gay bar wishing to open in an area where most venues catered for straight people, such objections would not be tolerated.

Labour Councillor Nick Small was among those who objected to the decision and told the Liverpool Echo: “I believe this will damage and change the area… it will change the character of the Stanley Street quarter.”

Councillor Small, who represents the Central ward, tweeted after the announcement:

Bad decision to give new lap dancing club licence to open in heart of Liverpool's Gay Quarter – I hope I'm wrong, but hate crime could rise — Nick Small (@CllrNickSmall) July 17, 2014

Liam Scully, director of Paradise, denied that it would not be exclusively for straight men. He said: “The suggestion that we are opening up a heterosexual club in a gay area does not sit comfortably with me.”

Another director of the club, Lesley O’Neil, added: “We are so excited about this venue. We feel our business can fit side by side with the others and benefit and contribute to the local economy.”

The new venue will bring the number of “sexual entertainment venues” in Liverpool city centre up to its council-determined limit of eight.