The MRA approved the Sunset Boulevard Beach Club last month despite the silent cinema, bar and restaurant being rejected by the planning authority and the City of Stirling.
The two-tiered outdoor venue, which would operate six months a year, was granted conditional approval following a 25 per cent reduction in capacity to 400.
Neighbouring resident Brian Roberts said the MRA failed to consider residents' concerns or give an adequate explanation about why the application was approved.
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READ NOW"We understand from the MRA that they have given a"conditional" approval," he said.
"However, even though we as residents are directly effected by this approval, the MRA told us today that they will not reveal the details of those conditions to us, and the only way to obtain them would be to apply under the Freedom of Information process."
Mr Roberts said he and others were concerned with noise the multi-million dollar project would cause, as well as potential traffic problems on Manning Street.
"The building has a single vehicle exit and entry point about eight car-lengths from the West Coast Highway, from which vehicles turn left and right into this section of Manning Street," he said.
"This congestion will be occurring far more frequently due to the daily closing time of the rooftop bars and conclusion of each film session at the cinema."
MRA chief executive Kieran Kinsella said the outdoor cinema was in line with the planning authority's vision for Scarborough and had been granted approval subject to a series of noise, security, parking and light emission conditions.
"Our vision includes a hub of activity with restaurants, cafes, shops, entertainment, and a range of events and activities for people of all ages, day and night," he said.
Proponent Robert Redmond said he had worked with the MRA to address traffic, parking and noise strategies.
"We received a 94.5 per cent approval rating during our community consultation from the public, with the only individuals against it residing at Observation Rise," he said.
The Sunset Boulevard Beach Club is set to open late this year.