The project is a joint venture between Agile Property Holdings, a Hong Kong-listed company focusing on mainland real estate, and local company King Wong Development.

'Our new proposal is a big improvement,' said August Tiu Chin-wai, who is in charge of Baroque on Lamma. King Wong's chief Bobby Li is dubbed 'the landlord of Lamma' - his firm owns more than three million square feet of land on the island.

Last year, the developer's plan was rejected by the Development Opportunities Office, which facilitates private proposals deemed worthwhile. The office said the residential density was too high and expressed concern about the ecological impact on the island's south, where endangered turtle and frog species are found.

Tiu said the height of residential buildings in the new proposal was reduced to no more than four storeys, instead of six or seven. The project would yield 700 to 900 flats.

If approved, the houses will be built on the hills surrounding Tung O Wan, where most land is currently zoned as conservation areas to protect the habitat of Romer's tree frog, an endangered species of global conservation importance.

The development site boundary would be 200 to 300 metres away from Sham Wan, a nesting ground for the endangered green turtle in the south of Lamma which is listed by the government as a 'site of special scientific interest' with restricted entry. Alan Leung Sze-lun, senior conservation officer for WWF Hong Kong, said his group was very worried about the project's impact on the endangered species.

'The green turtle is a creature that is very sensitive to light. Also, I doubt whether it is wise to rezone a conservation area for development because the zoning is supposed to protect natural landscape,' Leung said.

Peter Lee Siu-man, campaign manager of the Conservancy Association, said it was impossible for his group to support the project. 'Southern Lamma is too sensitive a site for any sort of development. The government once suggested the area be a country park but officials don't tell us what has been going on,' he said.

Asked why he thought housing would be suitable for the conservation zone, Tiu said the developer was thinking of rezoning the hilly land into a development zone and exchanging land with the government.

'We will surrender land of high ecological value in exchange for the less sensitive parts. Not all the land on the hills is vulnerable; some sites are just overgrown with weeds,' Tiu said, adding that a consultant was conducting an environmental impact assessment for the project.

The proposed marina, spanning across Tung O Wan in southeast Lamma in the original proposal, is now confined to the northern part of the bay, with 500 berths for yachts. The nearby waters would become a venue for international sailing races.

A six-star spa hotel at Shek Pai Wan remains in the blueprint and new roads are proposed to provide access. The developer will also suggest preserving abandoned houses in the 300-year-old Mo Tat Old Village as a cultural heritage spot, and setting up organic farms in the area.

Damon Wong Chun-pong, a resident of Mo Tat New Village who received a briefing from the developer recently, said he was worried that the project would ruin the natural scenic character of southern Lamma.

'Although the developer talked of conservation measures, the houses, the yacht club, the hotel will bring in lots of people. The whole environment will be completely changed,' Wong, an editor of Hong Kong In-media, a website run by independent reporters, said. Wong said most of the 30 indigenous villagers in southern Lamma had sold land to the developer.

A spokeswoman for the Agriculture, Fisheries and Conservation Department said a study completed in 2001 indicated that coastal waters off southern Lamma had the potential to be designated as a marine park to conserve some ecologically sensitive marine fauna, such as the green turtle and finless porpoise.

But the site was 'given a lower priority' in the designation timetable because Sham Wan is already protected by law as a restricted area, and the department's monitoring data showed finless porpoises made less use of the waters off the island's southern coast, the spokeswoman said.