Although plans by Killalea Coastal Investment (KCI) for 106 lodges are almost half the 202 first proposed in 2007, opponents say the bulk of the units remain in the park's premier location, The Farm.

In total, 81 of the proposed 106 lodges are in the area now occupied by a kiosk and car park overlooking The Farm surfing reserve.

Conference facilities and 311 car parking spaces are also proposed for the site.

The remaining 25 lodges are proposed for an area known as The Crest, to the north of The Farm.

The two development zones are located within an environmental protection (foreshore protection) zone, however tourist facilities are permissible within the zone.

Sonya McKay of the Illawarra Community and Environment Connection said The Farm in particular was "an iconic area" for many in the community, as well as a place of recreation.

"There are major concerns that this will be lost to private development," Ms McKay said.

"There are many reasons the proposed development should never have reached this point ... the development at The Farm is too much for the community to accept."

According to documents linked to the application, the project has an estimated capital investment value of $35 million and would create 150 full-time jobs during construction and 80 full-time jobs in operation.

The Director-General's Environmental Assessment Requirements, prepared in conjunction with Shellharbour City Council, have been issued.

These will be used in the preparation of a concept plan for the proposal, which when submitted to the Department of Planning will be placed on public exhibition.

The revised preliminary assessment was lodged with the department by KCI at the beginning of August, but the future of KCI itself is now unclear.

The company is owned by Mariner Financial after the collapse of joint venture partner Babcock & Brown.

Last week Mariner announced it had "verbally agreed" to sell KCI to an unidentified third party.