Sheffield Council is seeking powers that could force the sale of part of a major £42m regeneration scheme - after the anchor supermarket tenant pulled out.
In January Tesco confirmed that it had scrapped its plans for the Fox Valley development in Stocksbridge as it axed proposed shops and closed existing stores across the country to save money.
Since then talks between developer Dransfield Properties and Tesco on the unit’s sale have take place, with the hope of alternative retailers taking it on, but the land has not yet been sold.
Now a council report has revealed the authority is seeking permission to make a compulsory purchase order to acquire ‘the leasehold interest required in the land at Fox Valley to enable the completion of the comprehensive regeneration of the site.’
The decision, to be made by cabinet next month, is regarded as ‘key’ because it potentially involves expenditure of more than £500,000 although the land is likely to be worth millions and the cost of an order if it was used is difficult to estimate.
Coun Leigh Bramall, cabinet member for business, said costs would be covered by the developer and it was ‘not anticipated’ the powers would be required.
He added: “Fox Valley is a crucial scheme for the regeneration of Stocksbridge and the council fully supports it.
“Talks between the developers and Tesco are progressing to enable the development to proceed with alternative retailers.
“However, the council is also asking cabinet for permission to pursue a compulsary purchase order should it become necessary, for any reason, to secure the development. It is not anticipated these powers will be required, but any costs of progressing a CPO would be met by the developer.”
Fox Valley is to include shops, offices, a café and restaurant, as well as new housing and is funded by more than £8m of EU money.
Tesco would have created 250 jobs if it had opened its store there.
Plans for that unit to be sub-divided have been approved.
Amanda Holmes, head of communications at Dransfield Properties, said: “We are making good progress with the purchase of the Tesco land to ensure that area can be developed and delivered as part of the wider regeneration scheme.
“Given the importance of the development in terms of job creation and regeneration in this part of Sheffield it is important that all avenues are considered in the successful delivery of the project.
“One of those avenues is Sheffield Council’s support of a compulsory purchase order, should it be needed.”
A Tesco spokesman said: “We’re keen to see the site brought back to use and are continuing advanced discussions with Dransfield.
“We’ll keep the local community updated as discussions progress.”