A recently opened sex shop at 701 Kingsway is sparking objections from residents who've spent years trying to improve their neighbourhood.

Fantasy Factory moved into a property at the corner of Kingsway and Fraser Street without city hall approval last November. The site previously housed a video store. Fantasy Factory's exterior sign indicates it sells magazines, along with a "huge selection of adult toys." A small sandwich board on the sidewalk lists toys, lingerie, performance-enhancers and lubricants for sale. "They moved in without approvals. Now they're under enforcement because they're in there without approvals, so they've filed a development application to gain approval for the space," explained John Greer, manager of the processing centre in the city's development services.

Greer said the owner should have obtained development, building and occupancy permits. On July 28, advisory letters were sent to more than 700 neighbouring homes as part of the development permit application. Residents have until Aug. 13 to submit responses. "We're compiling them right now and we got a barrage over the weekend," said Greer. "We still have to assess [the business] within the regulations and policies and guidelines, which talk about location and vicinity of daycares, schools and churches--that sort of thing."

Fantasy Factory owner Tony Perry is convinced the city is trying to regulate him out of business and he'll go to court to keep his doors open. He said the previous video store rented and sold adult videos.

"We are zoned right and [the city] is looking for every way in the world to close us," he said. "I have never opened a store in 52 years where there weren't neighbours who said 'Oh my God, we're going to fall off the face of the edge of the world to hell' and three months later they didn't even realize we were there. But that's the history of this business."

Perry, who owns seven such businesses in Metro Vancouver, maintains Fantasy Factory isn't a source of problems for the neighbourhood and says its customers are people with good incomes.

"You'd be surprised who comes into our stores--doctors, lawyers, business people, professional people--all kinds, and 60 per cent of our customers are women. They're buying adult toys."

Peter Wohlwend, coordinator of Dickens Community Group, which formed in 2000 to improve the quality of life in the neighbourhood and to combat the drug and sex trade that had developed around Charles Dickens elementary, said all the comments he's heard about Fantasy Factory have been negative. "My personal view is this kind of business does not belong in a family-oriented neighbourhood," he said. "I know that the previous owner also had a small collection of adult videos for sale and rent, however they did not advertise it and this was not their exclusive business."

Resident Robert Andrew argued in an email it's not the kind of business that should be in this "improving family neighbourhood." He added: "It sends out a message, stop in to Mount Pleasant, Kingsway etc. to pick up the hookers and remain around here."

Perry said the city thinks if it notifies the neighbourhood and it can show the neighbourhood protests, then his business shouldn't be there.

"These people have every right in the world not to frequent that store, but they don't have a right to decide that other adults cannot patronize a legal and lawful store and that's what they're trying to do," he said. "It's a minority group trying to impose their morals on the majority. If they had their way, my God, I can't even imagine--we would still have horse and buggy."