TWO years after it was given the go ahead by planners, a controversial £10m scheme to convert the former Hexham swimming pool site into retirement flats is dead in the water.

Developer McCarthy & Stone confirmed this week the proposal to rejuvenate the historic facade on Gilesgate with 45 luxury apartments has been abandoned.

Citing the “challenging nature of the site” as the reason for the u-turn, a spokesman for the housebuilder confirmed it still had an interest in the town.

“We know there is a need for this kind of specialist housing in Hexham, and we are continuing to look for suitable sites nearby,” he said.

“Unfortunately, since our application for retirement living accommodation on the former Hexham swimming pool site was approved, it has become clear that the project is not economically viable, due to the challenging nature of the site.

“We are disappointed to say that we will therefore no longer be able to build the proposed development.”

Northumberland County Council, which owns the old baths and the surrounding area, confirmed the site would be put back on the market.

The plan, which was first mooted almost five years ago, involved a seven-storey structure which would include 45 one and two bedroom flats.

Although prices were never finalised, the properties were being advertised online until very recently and were expected to sell for between £150,000 and £250,000.

The scheme involved the demolition of two bungalows on Haugh Lane, bought by Tynedale Council in 2006 for £500,000, with a view to demolition when it was first considering developing the pool site.

However, the downturn in the housing market meant they were retained and let on short-term leases.

But the existing steep footpath from Haugh Lane up to Gilesgate – which was formally recognised as a public right of way around three years ago – proved to be the sticking point in McCarthy & Stone’s redevelopment plans.

The diversion of the footpath to the western boundary of the site attracted a barrage of objections and residents, Hexham town councillors and members of Hexham Civic Society attended a truncated public inquiry at Hexham Abbey last week which lasted less than an hour.

The Planning Inspectorate will now have to decide whether there is evidence to support the diversion of the route now that the development has been shelved. A decision is expected within six weeks.

Mayor of Hexham, Coun. Trevor Cessford, said: “Like many people, I am keen to see that site developed.

“Even those who were objecting over the right of way weren’t against the site being brought back into use.

“McCarthy & Stone has had two years to sort out the problems and, recently, let’s just say it has been deafening in its silence.

“This scheme is clearly dead in the water, so we look forward to seeing what comes next and who might be prepared to take on the site.”

County councillor for Hexham West, Derek Kennedy, said he was bitterly disappointed at the news and raised concerns about the state of the site, which is next door to the abandoned Links building, which was closed by charity Barnardos in March due to funding constraints.

“This was going to be a multi-million pound investment which would provide accommodation for older people living right in the heart of Hexham,” he said.

“Not only would it have brought the site of our redundant swimming pool back into use but, from the Haugh Lane side, it would have tidied up that whole area which has become a horrible wilderness.”

Meanwhile, the council offices in Prospect House look set to be empty from the end of next week as the final members of staff move out. On Wednesday, six staff from the building control and local land charges teams packed up their desks and made the move into Hadrian House, with only a handful of staff left to vacate by Friday.

A removal van was also seen outside collecting furniture and pictures.

The building was sold in February, although the identity of the buyer is yet to be confirmed.