In answer to your question, I am guessing that permission would be needed. However before being bloody minded about compensation and making things difficult, remember that can work both ways.
What happens if permission does go through?
Firstly the owner has a right to make repairs to his building. At that point the wrangle for permission would come into play - they will get it. As for compensation - for what exactly? Will you have any financial losses for example? I doubt unless you can prove that, that any compo would be forthcoming.
The owner could of course make that end of the building look an eyesore, or perhaps put his food bins next to the adjoining wall? Like I said, being difficult can work both ways. I'd suggest concentrating on stopping the planning. If all else then fails, you might find they will work with you on issues rather than against if you too are prepared to be reasonable..