Fears have been raised that the former Royal Mail sorting office in Barrack Road could stand empty for years to come after Tesco pulled out of plans to redevelop the site.
The supermarket giant had been in talks with Royal Mail to take over the abandoned Northampton building since the beginning of 2010.
But just days before the development was due to be given planning permission by Northampton Borough Council, the company yesterday made the shock announcement that it was no longer interested in the scheme.
A statement issued to the Chron last night said: “Following detailed discussions with Royal Mail, we have decided not to proceed as tenants for the proposed Barrack Road store.
“We understand this news may be disappointing but were keen to announce our decision prior to the application being considered by the council.
“We will continue to serve our customers to the best of our ability from our existing stores across Northampton.”
The news has been met with shock by local politicians, who had hoped Tesco would rejuvenate the dilapidated area around the sorting office.
Councillor Winston Strachan (Lab, Castle) represents the Barrack Road area on Northampton Borough Council.
He said: “It’s a real disappointment because I really wanted something positive to happen there. Unemployment is high in that area and there’s not much happening there so I thought Tesco opening up would have really helped.”
The sorting office closed in 2003 after a major fire swept through the building.
Councillor Strachan said: “It looks terrible now, just like a prison with barbed wire and fences all around it. I hope it won’t stay like that for another 10 years.”
Royal Mail last night told the Chron they were “disappointed” with Tesco’s decision.
The Chronicle & Echo first revealed in January 2010 that Tesco was in talks with Royal Mail to redevelop the site of the former sorting office in Barrack Road, which was hit by a fire in 2003.
In June 2011, Royal Mail confirmed a deal had been signed with Tesco to redevelop the site.
The scheme was due to be given planning permission by Northampton Borough Council during a meeting at the Guildhall next week.
Only 12 members of the public had objected to plans for the Tesco development. They had raised concerns about the impact of traffic from the store.