Setback for city revamp.

PLANS for a multi-million pound revamp of part of Newcastle city centre have been hit by a setback.

It had been hoped that the scheme to redevelop the East Pilgrim Street area could have created an impressive new gateway to the city and brought in thousands of jobs with a mix of shops and offices.

But the recession has put the brakes on the plans. Instead empty offices in the area are to be rented out for the short-term.

Parts of the huge site, which stretches from the city centre to the Central Motorway, have stood empty for years.

City councillors hope to attract a major retailer, such as Harvey Nichols, and help to cement Newcastle's position as a premier shopping location. But for now offices including Norham House, Watson House, Commercial Union House and Bamburgh House will be re-branded NE1 Offices. Bill Shepherd, the city council's executive member for regeneration, said: "I think this would seem a reasonable way of bringing the land back into short-term use. If you're planning something which will potentially take 15 years it's not unreasonable to use this space as offices, but only in the interim."

Nick Kemp, who chairs the council's regeneration scrutiny team, said: "In the short term this may well be good news, since the recession is having a damaging impact on many sites. But overall it's a step back from where we want to be."

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