It was heavily criticised by campaigners, including Vicky Boarder, the co-owner of the Fresh Fish Company, which would have lost some customer parking.
In a statement, Transport Minister Eddie Noel said: ‘I asked the project team to review the proposals in view of the strength of public opinion, and to consider how to address the issues raised either by amending the proposal or by submitting a revised application.
‘Now the application has been withdrawn we have the opportunity to rethink the plans and consider how best to meet the needs of the Sea Cadets.’