Residents are standing against plans to demolish a historic building in Wangaratta, a move that would allow an industrial business to develop townhouse accommodation in the precinct.

Bruck Textiles has submitted an application through Wangaratta council to build new accommodation to cater for skilled workers they're looking to attract to grow the business.

Under plans, seven new dwellings will be built in the vicinity of the heritage listed Bruck House and a full demolition of the caretaker's quarters, including carport and services out-building, would take place.

However, the proposed change to the precinct has upset a group of residents, the Robin Boyd Foundation (named after leading modernist architect who designed Bruck House) and historians.

Tony Isaacson from the Robin Boyd Foundation visited Bruck Court, along with others, to view the buildings this week.

"We consider these buildings are of national significance as they are a cluster of buildings and are quite unique, employer provided housing for a company," he said.

"It's not a matter of selecting one jewel and keeping it, it's a matter of keeping the whole group of buildings together because the sum of the parts is greater than any individual buildings."

Mr Isaacson said they have assessed the buildings and reviewed the documentation provided by the owner and they are absolutely certain that the caretaker building could be easily repaired, restored and kept.

"Neither the changes or condition of the building warrants its demolition, and the linkage that it's sitting between Bruck House and the other three, makes it integral," he said.

"Putting modern buildings of a different scale - two-storey with a kind of weird sawtooth roof that looks more like a factory than a house - in the middle of this group of houses will destroy the value of the precinct."

The group accepts there's room for two townhouses behind Bruck House and that these would not detract from the precinct.

They also suggest that a portion of a current 33-lot subdivision proposal for industrial land (near the site) could be used for Bruck Textiles accommodation purposes as an alternative.

"There are 33 industrial lots and some of those are along the main road (Sisely Avenue) and they would be appropriate for residential," Mr Isaacson said.

Benalla historian Hamish McPherson said the site was of great heritage significance because Robin Boyd was Australia's leading modernist architect.

He said local residents of Bruck Court are objecting to the application as are people with expertise in architecture and heritage matters because of its national significance.

"Wangaratta council has an opportunity to preserve a really significant and special place to the people of Wangaratta and we'll be continuing this campaign to make sure this really important place is not destroyed for short-term interests," he said.

Wangaratta Historical Society member Claire Russell said council seems to be just saying that none of this is important.

"We've got this massive history of Bruck Australia here who brought international employees to live and work at these buildings and now council are prepared to just remove the caretaker's quarters," Ms Russell said.

Under the plans, new accommodation would include the construction of five two-storey terraces in a staggered arrangement, with five new carparking spaces and associated access via a new driveway from Frank Hayes Drive (to the rear of Bruck House).

Two new two-storey terraces have been proposed to the southwestern corner of the site to match the detail and appearance of the other new two-story residences.

As part of the application it stated that "Council was supportive of Bruck House being able to subdivide and develop further accommodation on site, to support the growth of the business and go back to housing key employees on site, as weas originally done".

It's expected that councillors will be asked to make a decision on the permit application at the 16 December meeting.