A former general store will be demolished, and a cafe, with a residential apartment will be constructed.
The apartment will be built on the second level of the cafe.
It will be located at St George's Square.
The development application received 11 representations to the City of Launceston council. Concerns about parking and traffic were raised.
At Thursday's meeting, resident Glenda King was the only resident to speak against the proposal.
She said the proposal was a significant change of use to go from a general store to a 50-seat cafe.
"I will result in a large loss of amenity ... and it fails the planning scheme on that alone," she said.
Ashley Brook, from 60 Degrees planning said the report showed the proposal will not cause a significant loss of amenity.
Councillor Tim Walker moved the motion and said the council was cognizant about re-purposed buildings.
"There is an abundance of parking in the area," he said.
"There will be other things like this that come along."
Councillor Andrea Dawkins also addressed the concerns about parking.
"Parking will never not be a problem," she said. "But why not park the car further away and walk up the hill like the Heart Foundation suggests."
Councillor Hugh McKenzie said he empathised with the surrounding residents' concerns.
"But, I can't see where in the planning scheme that we as a council can vote against this," he said.
The motion passed unanimously.