Project Pinewood, the ambitious plan by the listed film studios group to create 1400 new homes behind the facades of permanent film sets, has been refused planning permission by Eric Pickles, local government minister.
Shares in Pinewood Shepperton, which is chaired by Lord Grade, slumped 12%, or 20.5p, to 252p. Only last week the studios, where The Iron Lady, the film about Margaret Thatcher, was made, were visited by Prime Minister David Cameron as part of his rallying call for the British film industry.
Pinewood said it was disappointed by the decision but claimed that the amount it had spent buying land and putting in the planning application "are not material to the long-term prospects of the company".
A statement said: "Having weighed up all of the material considerations he concludes that the benefits of the proposal do not clearly outweigh the harm to the Green Belt and that very special circumstances to justify development in the Green Belt do not exist."
At its last results it said it had spent £7.6 million on the scheme.
Objectors claimed that Project Pinewood impinged on the green belt in Buckinghamshire and was a back-door attempt to build homes in an area where residential building would not normally be allowed.
The plan involved building homes behind sets including a Venetian canal, Parisian boulevard and New York brownstones.
