Despite being recommended for approval by council planning officials, the application, tabled at a meeting of the development quality committee three weeks ago, was rejected unanimously by elected members.

It is understood the university had hoped to have the new student residence ready for occupation for the start of the 2006 academic year.

The university is known to be both shocked and upset by the city council rejection of the residence plan, particularly after the site involved had been identified in consultation with council officials.

Hours after the committee vote, a spokesman for Abertay said the institute was “extremely disappointed” over the turn of events.

Nigel Hawkins, the chairman of estates and campus services committee of the university court, said Abertay had invested “a huge amount in time and finance in preparing the proposals” and the council’s decision had come “as a bolt from the blue”.

Mr Hawkins said the consequences of the decision for the university and for the city “could not be more serious.”

The problem for the university is that a lot of its present accommodation is some distance from the main campus in the city centre and also not of the quality required.

Because of the possible delay involved — and with absolutely no guarantees the exercise would be successful in any event — it appears unlikely that Abertay will appeal the city council’s refusal to the Scottish Executive.

Instead a range of other options — likely to include both a new build project on some other city centre site or a refurbishment of some existing property or properties in the central area — will now be examined.

However, the university will now have to balance the need to progress a development relatively quickly with not wanting to suffer another set-back in the efforts to provide new student accommodation.

A spokesman for the university said there had already been one meeting with officials of the city council soon after the development quality meeting earlier this month, to begin the process of looking at alternatives.

“Other meetings are being planned for the new year, while the university carries out a detailed assessment of its options,” said the spokesman.

— On a happier note, Abertay’s new student centre building at the junction of Constitution Road and Bell Street is now nearing completion after a delay caused by the collapse of the original main contractor for the project.

The £6 million building is now substantially complete and throughout January and early February, contractors will be involved in fitting out the interior.

The project is on schedule for a handover to the university on February 25.

After that, there will be a phased opening over the following few weeks.