I think the reality of the situation is that if the Council refuses BH permission to build 1 bedroom flats the development will stall for at least a year. We will have an eyesore. The pub nearby will not have new customers and may close.
If BH build 1 bedroom flats and the survey that says we do not need 1 bedroom flats is correct, they will not be able to sell them. So who loses? Answer BH. that will teach them not to review planning permission. An expensive lesson.