Residents raised their concerns about a plan to build 69 serviced apartments on the controversial site during a public meeting at Wollongong City Council on Tuesday night.

"Brickyard Point is one of the most scenic headlands in NSW and the proposals over the last 15 to 20 years have been attempting to desecrate this beautiful headland," Austinmer resident Ian Rodden said at the meeting.

"If we allow these 60-odd apartments to be built on this site it will become a five-storey high-rise slum in future years - it's totally inappropriate."

The 10-year-old plan, approved by the council, was revived last year by the site's latest owners, the Stevens Charles Property Group.

The historical development consent - which includes a tavern, restaurant and function centre built next to the serviced apartment blocks - remains active as some works started in 2007.

However, the property group says the serviced apartments need to be subdivided using strata title, so they can be sold to individual owners to make the project financially viable.

It has also proposed to split the site into two large Torrens Title lots, instead of the existing nine smaller allotments.

The Independent Hearing and Assessment Panel (IHAP) has been charged with deciding whether this subdivision should go ahead due to the significant community interest in the site.

Council staff have already recommended it be allowed, as long as the strata subdivision occurs after the entire tavern, restaurant and function centre building is complete.

During the meeting, IHAP chair Alison McCabe reminded residents the subdivision would be a "straitjacket" for panel members, who could only deliberate over that issue despite their wide-ranging concerns.

Eight residents told the panel of their worries about increased traffic, the structural integrity of the headland and the developer's future plans to "build an apartment block by stealth".

"I think it's highly likely that down the track the developer will make an application to rezone those serviced apartments as an ordinary residential apartment high-rise," resident John Spira said.

Another resident, Neville Mcalary, who is also a structural and mining engineer, said he believed the headland was "in no shape for a multi-level building with an underground car park" as it had "a large geological discontinuity" running through it.

He also said the developer's plans would not give the Illawarra any tourism benefit and was worried they would not end up building the tavern and restaurant building.

"The development is in total conflict with the coastal foreshore protection legislation and just the pure bulk and size of the building doesn't fit in with the northern suburbs coastline," he said.

"I think they should increase the size of the apartments and build less of them, so that it is more of a boutique-y development.

"They're no more than a prison cell according to this plan."

But Stevens Group partner Graeme Charles told the panel the approved 2004 plan for the site was "perfect" and assured panel members his company intended to sell the strata units and serviced, tourism apartments.

Ms McCabe said the panel would make a recommendation by the end of this week.