If what the neighbor has done is a violation of the zoning for that
area, what he needs is a variance to keep it, otherwise it has to go.
Typically, municipalities have Boards of Adjustment, which are there to
hear variance cases and decide whether to grant them.

The applicant has to notify all property owners within a certain
distance, provide them with info on the variance request, when the case
will be heard, etc. He will need to make a case to the board that what
he wants to do deserves a zoning variance. You need to attend the
meeting and tell the board why what he is requesting is detrimental to
your property and welfare and why the variance should be denied. The
more info you have, the better chance you have of prevailing. I'd
also talk to sympathetic neighbors, about how this may affect their
property as well. Most people probably don't want the neighborhood
being turned into a storage area for boats, trailers, etc. Get them
to attend the meeting or if they can't, provide affadavits. I'd also
get a real estate appraiser to give an opinion that your property will
be worth less if this is granted and have the appraiser attend the
hearing as an expert witness for you. Since you are the most affected
property owner, your opposition should be a major obstacle. However,
depending on who the guy knows, if he hires a politically connected
lawyer, etc, anything can happen.

You could also consider hiring an attorney, which would increase your
chances of prevailing, but can be expensive and is not required.