Permission has been granted for a 208-bedroom co-living scheme in Dún Laoghaire in Dublin on condition that each unit will have its own cooking facilities.
Developers Bartra Capital Property issued a statement welcoming the decision, saying that it reflects Ireland's need to cater for changing living habits.
The five-storey scheme on the site of a former Christian Brothers school was controversial because of the shared accommodation model, which involves en-suite bedrooms of just 16.5 square metres with communal living areas and kitchens.
The original application involved one kitchen for every 40 people.
The co-living model - like student accommodation - does not have to meet minimum studio apartment sizes of 37 square metres.
It also does not have to provide underground car parking for residents or Part V social housing.
In its decision, the planning board cited the Government's Rebuilding Ireland Plan for Housing and Homelessness, as well as the status of Dún Laoghaire as a major town centre.
Bartra CEO Mike Flannery said: "This is a pragmatic decision based on Ireland's need to embrace new tenure types.
"The Bord recognises that there is a place for co-living within the Irish housing market and we look forward to delivering this new and innovative form of accommodation."
Bartra was refused planning for another co-living development with 222 bedrooms in Tallaght, pending the drawing of a local area plan and also has plans for schemes in Rathmines and Blanchardstown.
The company has said co-living is aimed at young people moving to Dublin for work, and rents of €1,300 a month would compare favourably to €1,800 for a one-bedroom apartment.
Local TD, Richard Boyd Barrett, has condemned the decision by An Bord Pleanála as "shocking and disgraceful".
The People Before Profit deputy said that "this development is not about solving the housing crisis but exploiting it for profit".
"These box rooms with pull-out beds will have zero impact on the housing crisis and will only mean more unaffordable, inadequate places to sleep for people.
"What we need in central Dún Laoghaire is decent quality, affordable and public homes for those currently paying extortionate rents and those on the waiting lists," said Mr Boyd Barrett.