THE DEVELOPER behind Dorchester's controversial Charles Street scheme has confirmed that it is 'unlikely' it will be able to make the project viable.

West Dorset District Council has said it maintains the ambition to develop the site and is now looking for fresh ideas for taking the area forward.

The council's executive committee will consider a recommendation to terminate the development agreement with Simons at a meeting on Tuesday next week.

The Echo revealed in July that the council had concerns that Simons may not be able to make the scheme viable in light of a report by English Heritage, which called for more extensive archaeological works to be done prior to development of the site.

In a letter to the district council chief executive of Simons' chief executive Tom Robinson has now concerned it is unlikely to be able to proceed with the scheme.

He said: "Unfortunately the overall costs of the delivery of this scheme including the cost of construction and satisfying the requirements of English Heritage in respect of the archaeology are such that we are now of the view that it is unlikely that we will be able to satisfy the viability condition in our development agreement and would be interested to understand whether you also share this view.”

The district council says it has been working hard to help bring forward plans to improve shopping in the town centre by developing the Charles Street site.

It says it is disappointed that Simons believes it may no longer be able to pursue its plans but it is still hopeful of finding the 'right scheme' for the site.

Council leader Anthony Alford said: "We remain ambitious for this key town centre site. Our vision is to keep Dorchester a thriving shopping destination and keep retailers in our county town.

“We are disappointed. We understand Simons has reviewed the project not least the comments from English Heritage, a lot has also changed including the global economic situation.

“However, we have to take the long view. We must work to find the right scheme for residents, businesses, customers and communities. It has to be viable, welcomed and valued now and in years to come.

“Hopefully this gives us a chance to re-engage with the public and win their support for fresh opportunities to bring prosperity to our wonderful county town.”

Simons and the district council first penned a development agreement for the Charles Street scheme in 2007.

Since then the council has agreed to spend up to £2million on preparatory works for the site as well as allocating further funds of up to £2million to underwrite the 'financial gap to viability' if necessary.

Dorchester Town Crier and town councillor Alistair Chisholm said the news had come as little surprise to many but still represented a blow to the town.

He said: "It's a sorry, sad. shameful saga.

"I does make you wonder whether local authorities and councils can actually work together."

Steve Bulley, president of the Dorchester Chamber of Commerce, said: "The Chamber is clearly disappointed Simons are not proceeding with phase 2 of the Charles Street development. "But it does give a chance for the town to re-think exactly what we need in terms of retail and accommodation for the good of the town."