Business leaders fear traders will quit Birmingham's Jewellery Quarter if a controversial church group which has been branded a cult sets up a base in the area.
The Mail revealed last month that the Jesus Army wanted to redevelop a former office block in Lionel Street with plans for a worship centre, cafe and a walk-in facility for prostitutes, drug addicts, the homeless and asylum seekers.
The move has infuriated companies based in the Quarter, which houses some of the city's top bars and restaurants and is in the running to be named a UNESCO world heritage site.
And officials working to boost the area said they had been told several firms would quit the area if the scheme, which is currently on hold, went ahead.
Chris Booth, chairman of the Jewellery Quarter Association Heritage and Regeneration group, said: "I have already discussed with at least a dozen business owners who have commented that they will vacate the immediate area if planning consent is granted. This area will be blighted."
It was thought the Jesus Army Charitable Trust, which is part of a group with assets of more than £14 million and an annual turnover in excess of £20 million, paid just under £1 million for the office building. Army members stage high-profile recruitment campaigns in public places.
Birmingham's busy Broad Street entertainment district is regularly targeted by members keen to increase the group's presence in the city.
But there have been allegations the Jesus Army operates as a cult. It has been criticised by former members and other church groups for its "authoritarian-style" amid claims members were put under pressure to commit to life-long celibacy and hand over their material possessions.
Ian Howarth, director of the Cult Information Centre, a charity providing advice about cults, said he was concerned about the activities of the Jesus Army.
"They have done nothing recently to change my mind," he said. "I have great sympathy with the businessmen whose premises will be near to the centre."
* JESUS Army spokesman John Campbell denied the organisation was a cult and said Birmingham should welcome its plans.
He said: "Being labelled as a cult is a serious allegation. We are a Christian Church and are recognised by other church leaders. People are free to come and go of their own free will and we seek to do good in the community."
He did not deny some of the group's members chose a celibate lifestyle or handed over all their cash and possessions.
"That is an option that exists in many religious groups," he said.
Mr Campbell forecast that fellow residents and businesses in the area would welcome the Jesus Army.
He said: "There is a lot of ignorance about the Jesus Army and, when we are up and running, people will be very happy."
He said a similar project in Coventry had been praised by police.