Too many characters in character literal

Issue: Getting "Too many characters in character literal" error when try to build a SharePoint project. Error in the following line of code in application page
Assembly Name="$SharePoint.Project.AssemblyFullName$"

Cause: Since the SharePoint project is a sandboxed solution, Sandboxed solutions do not support the application pages.

Reference: http://msdn.microsoft.com/en-us/library/ee231562.aspx

Resolution: Fixed it by changing the solution from Sandbox to farm.