NO CONSTRUCTION work is to take place on Sheffield's new Sevenstone retail quarter until at least 2011 - leaving a swathe of derelict land and blighted buildings around the city centre for the next two years.
Sheffield Council has sent letters to all businesses being served with Compulsory Purchase Orders to make way for the scheme, between The Moor, Charter Square and City Hall, informing them of the delay.
Work on the project by developer Hammerson was supposed to start last year, but there have been a series of delays.
Last August, the start date was put back to this summer. Then, six weeks ago, urban development company Creative Sheffield told The Star Sevenstone was being delayed indefinitely due to the credit crunch.
The organisation issued a statement the following day in which director of regeneration Andy Topley said it remained "optimistic the larger elements of the project will start in 2010".
But yesterday a Hammerson spokeswoman admitted: "There is no start date at this stage. We are still committed to the scheme and we are continuing to progress with planning and design. We are unlikely to start until conditions improve."
Simon Bower who runs Pollard's Coffee House on Charles Street, one of the businesses to receive the council's letter, said he and owners of neighbouring businesses feel "despondent" and left in limbo.
They do not know when they will have to move and have not received money for their premises, so are unable to plan for the future.
Mr Bower added: "Effectively what they are doing is slowly strangling all the businesses and Sheffield is losing shoppers to Leeds, Manchester and Meadowhall."
The letter was sent by Max Littlewood, of Sheffield Council's corporate property division, who wrote that the scheme was progressing "at a slower pace than originally intended, in light of current macro-economic conditions".
He added: "The main construction contract is now unlikely to commence before 2011."
Mr Littlewood said the former Wellington Street fire station, where the new John Lewis department store is planned, is to be demolished later this year.
But that will leave the site - to be the first phase of the new shopping area - as a derelict hole in the ground for more than 12 months.
And empty boarded-up shops around Cambridge Street are likely to remain in the same state for even longer as new shops are not scheduled to be built there until later stages of the scheme.
Mr Littlewood said that, in the meantime, the council was "looking to work with property owners to introduce temporary uses and activities into any vacant properties wherever possible".
Coun David Baker, deputy leader of Sheffield Council, said: "We are working closely with Hammerson to ensure Sheffield gets the best retail quarter, so both local people and visitors have a vibrant city centre shopping offer.
The letter to tenants provides them with an update on the scheme and work is still ongoing to deliver Sevenstone.
"South Yorkshire Fire and Rescue Service's headquarters is now complete and the service has transferred its operations to the new site and the old site will be demolished this year.
"Significant preparatory works are in progress, utilities have been completed, planning applications are being considered, the development certainly isn't on hold. In a climate where big developments across the UK have been scrapped, Hammerson remains committed to Sheffield."
Carolyn Kenney, project director for Hammerson, said: "We remain committed to Sevenstone and, as reported with our annual results in February, it is anticipated main works on site are unlikely to commence before an improvement in economic conditions.
"We are continuing with the design and planning stages, so we are in a positive position to move forward when conditions improve.
"It is important to keep all affected businesses and property owners within the compulsory purchase order area informed with details of the scheme and, working in partnership with Sheffield Council, this dialogue will continue throughout the process."
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