Conservationists have launched a campaign to halt a multimillion-pound British-designed building development next to the Leaning Tower of Pisa, which they claim will disfigure the mediaeval heart of the city.

David Chipperfield Architects won an international competition for the urban redevelopment of the 13th-century University Hospital of Santa Chiara, which directly adjoins some of the world’s greatest mediaeval treasures; the Duomo (Cathedral), its celebrated leaning belltower, and the circular baptistry.

With the walled cemetery, or Camposanto, the delicate and intricately carved white marble buildings form a unique architectural ensemble on the Cathedral piazza or Field of Miracles (Campo dei Miracoli), a Unesco World Heritage site.

The hospital, which forms the south side of the piazza, is moving to a purpose-built greenfield site at Cisanello, an eastern suburb of the city. The sale of the historic buildings will fund the move. However, Piero Pierotti, Professor of Architectural History at Pisa University, said the development would “do nothing to reinforce the cultural value of the Field of Miracles, which is the reason visitors come to Pisa. Perhaps we need another miracle”.

Professor Pierotti, who is head of Art Watch Italia, a conservationist body that monitors threats to Italy’s heritage, said: “What worries us is the sheer scale of the investment.”

Paolo Fontanelli, the Mayor of Pisa, said the project was worth an estimated €150-200 million (£104-£138 million) and was due for completion by 2016. “The time has come for a debate about the future of the city,” he told La Stampa. “We have to find the right balance between generating income and urban development.”

The plan envisages the transformation of the 118,000 square metre hospital site into a residential, office, hotel and restaurant complex. A third of the space is reserved for public use. But campaigners are incensed.

Professor Pierotti said the result would be “an eyesore which will forever harm the symmetry and harmony of the great piazza”. A “busy new road” would cut through Pisa’s botanical gardens, said to be the oldest in Europe. The Chipperfield project was chosen from a short list of ten by a jury chaired by Professor Carl Olmo, the head of urban planning at Turin University, who said it was “the least disruptive”.

But Professor Pierotti said this was “not enough. The fact is it changes the use of the building completely.”

On a visit to Pisa last month Mr Chipperfield told La Nazione, the Tuscan newspaper, that he had studied the city carefully on foot and from the top of the Leaning Tower to ensure that his plan fitted in with the piazza.

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