Plans which include a development of 140 homes at the Caterpillar site in Shrewsbury are to go before councillors next week.
The £4.8m redevelopment of the site off Lancaster Road would also see the creation of a 275-space car park.
Other changes include the erection of a new reception building, works to existing industrial, office and welfare buildings and other external alterations.
Many local residents in the area have voiced their concern over the amount of additional traffic the houses would create and the access on and off the proposed development.
Mount Pleasant Road has long been a hot spot for traffic congestion with long delays from Heathgates Bank towards Lancaster Road traffic island during peak times.
Shropshire Council officers have been recommended to approve the plans.