A legal challenge against a scheme to redevelop a brownfield site in Peterlee could put jobs and investment at risk, according to county councillors.

In March, a Durham County Council planning committee approved a £16 million scheme to redevelop the former East Durham and Houghall College on Burnhope Way with the creation of three retail units, and a restaurant and coffee house, both with drive thrus and free parking.

The development is being challenged legally by the current owners of Castle Dene Shopping Centre, Praxis. Two judges have already dismissed the legal challenge, but Praxis are appealing the latest decision.

Developers Quora (Peterlee) Ltd gained planning approval for the 2.56 hectare site, with two of the retail units set to be occupied by Lidl and Home Bargains and the two restaurants to be occupied by Starbucks and KFC. 120 jobs are expected to be created as well as securing future homes for two existing local retailers, Home Bargains and Lidl, which are not renewing their current leases in the town.

Cllr Carl Marshall, Cabinet Member for economic development said: “It is incredibly disappointing that something which would attract additional investment into the town is being challenged. The scheme would give a much-needed boost to Peterlee town centre at a time when town centres are struggling. New jobs and additional investment are now threatened as a result, along with the future of existing retailers in the town. Many areas of the county are crying out for investment and would love such a scheme, it’s almost like they don’t want the town to develop.”

Cllr Audrey Laing, ward member for Peterlee East, said: “Together with local residents I have been campaigning for the re-development of this site for many years. Peterlee is a growing town and deserves excellent facilities. Previous developments for the site have been thwarted by Praxis and I am shocked at this continual challenge.

“I find it incomprehensible that anyone would object to new jobs and investment in the town. Residents tell me they want more and a better choice of shops and I strongly believe that this development would give a much needed boost to the local economy.”

Easington MP Grahame Morris, commenting on Praxis legal challenge against the redevelopment of the former East Durham and Houghall College site in Peterlee, said: “Castle Dene Shopping Centre (Praxis) is blocking investment in Peterlee. We lost a Tesco supermarket because of their legal challenge, and they are using the same tactics to stop this retail park.

Praxis should not pitch themselves against the best of interests of the community and Peterlee residents, who welcome the investment, regeneration, and the potential new jobs the retail park will bring.

The retail park will attract more footfall to Peterlee, with more people using the Town Centre, and facilities, if they provide the shops and amenities people want.

Praxis should focus on improving its own retail offering rather than stopping others from investing in and backing Peterlee.”