The site is a Special Housing Area, so 10 per cent of the homes must be affordable. At the moment that means they would be priced at $550,000 or less.
But Devonport-Takapuna Local Board member Jan O'Connor said Belmont was not an apartment area.
Building that number of extra homes would have a major impact on the already congested Lake Rd, the only route in and out of the peninsula, O'Connor said.
"Our board has really opposed any redevelopment until the Lake Road issue is addressed," she said.
"It's been like this for many years, it's not something that's just cropped up."
Local residents Lesley and Myles Opie said the old navy housing area was a "shambles" and needed upgrading, but over 300 new homes would create unmanageable traffic.
"It's going to be a massive increase in cars," Myles Opie said.
Lesley Opie was concerned that the development would be pushed through under the Special Housing Area (SHA) regulations, with locals kept in the dark about what was happening.
Under the rules the public does not get a say on applications to develop SHAs.
"That's wrong.," Lesley Opie said.
"That's like bulldozing and not having any consideration for the people living here."
Rob Hutchison, chief executive of the iwi's commercial arm, Whai Rawa, said the five-storey apartments were planned for the middle of the site, with lower rise townhouses and single homes around the fringes to minimise the impact on surrounding neighbours.
"From an urban design perspective I think it achieves a whole lot."
The size of the seven blocks it had purchased on the peninsula provided a real opportunity to see an improvement in urban design, he said.
"The continuation of infill housing or just building to strict District Plan requirements will create a sub-standard urban design product," he said.
Ngati Whatua Orakei believed there should be diversity of housing, and Devonport was at risk of becoming an unbalanced community.
"Young people can't afford to live here, people that work in Devonport can't afford to live here, i.e. the navy.
"Elderly people have no options here."
The development would be done in stages, with just 10 to 20 dwellings built in the first year, depending on demand.
Construction would also not begin until 2018 as the navy still had a lease on the land until then.
The iwi was spending quite a bit of time and effort to provide other transport alternatives in the design, such as walking and cycling tracks, and it was confident the extra traffic onto Lake Rd could be managed, Hutchison said.
