Hammerson and Sheffield City Council have “reached mutual agreement” to drop plans for a new retail quarter in Sheffield, which Hammerson described as “pre-recession”.
The developer has conducted a regular review of its major UK development projects to ensure resources are focused on completion of pipeline schemes.
In a statement, Hammerson said: “Going forward, we must ensure our capital and human resources are appropriately focused on completion of schemes which offer the most attractive returns over the medium to long term.”
The firm is now set to focus on its major retails in Leeds and London, including at Croydon and Brent Cross.
The Sheffield scheme had been hit by a number of delays, but John Lewis has agreed a deal to hold an anchor tenancy, while Construction News understands up to £60m may be made available by the council, depending on the extent of the scheme.
Utilities are in place, while compulsory purchase orders have already secured the site.
The developers are understood to have been given a May deadline to give a date when they could make a start on site.
Hammerson chief investment officer Peter Cole said: “We have worked very hard to achieve a retail scheme that creates a thriving city centre environment in Sheffield.
“Through this process we have looked at various options to redesign the original large-scale scheme, which was conceived pre-recession.
“We have now reviewed our UK development projects and having made significant advances and commitments on a number of our other schemes, we have therefore decided not to progress Sevenstone.”
“We agree with the council’s ambition to regenerate the city centre which remains a high priority and that all parties want certainty.
“We will be working with Sheffield City Council and John Lewis on identifying ways in which the City can build on our work to date and how they may best take forward the opportunity to create a deliverable regeneration proposal in the future.”
Sheffield is now to begin work on another scheme with a different partner.
The council said it was seeking to end the development agreement and seek a new investment partner in order to “establish certainty” for the scheme.
Sheffield council member for business, skills and development Leigh Bramall said: “We are taking control of the situation. We have got everything in place to make this a viable, attractive development scheme, and we can’t wait any longer to take this forward.
“I can appreciate Hammerson’s desire to ensure that this investment meets with their commitments globally and the additional finance that that may require, but the people of Sheffield have waited long enough for a new retail quarter. We are doing everything we can to make this happen, and now this means seeking a new partner.”
“The Council’s view is that the city can’t wait any longer. We have the land assembled, utilities in place, have established the level of funding available, and methodology to inject the funding to undertake supporting public works. We have confirmed a scheme is viable and so we will now be seeking a new development partner to move the project forward in the shortest time possible.”