DEVELOPERS are demanding taxpayers fill a funding gap of more than £10 million in the faltering King Alfred redevelopment.

The Argus can reveal Crest Nicholson is attempting to renegotiate its winning bid for the prime Hove seafront site as it claims inflated costs have made the £200 million scheme unviable.

Campaigners are urging the council to walk away from the deal and start the process again.

The news comes as delays to the major seafront project continue to drag on.

Crest Nicholson and The Starr Trust were chosen as the winning bid in January 2016.

Building work was scheduled to start in October so the £40 million leisure centre could open at the end of 2019.

But a public planning consultation scheduled for last summer is still to be carried out and recent council documents shunted the completion date back to 2022 to 2028.

A source told The Argus costs had risen by more than £10 million which could be covered by a bid to the Homes and Communities Agency. The city council is already committed to contributing £8 million of public money to the scheme.

The local authority said the application would add further delays as it would be a complex bidding process with no guarantee of success.

The source said: “It will be a very different scheme to the one the council signed up to.

“There has to be questions about the process in how we got to this situation.

“There will be a perception that the council is seeking more public funding to sure up Crest’s profits.

“I’m not sure if the differences are irreconcilable. The officers are still glass half full that it can be resolved. But it might come down to who blinks first.”

Labour Cllr Tom Bewick said: “West Hove is seeing population growth of five per cent over the next few years, predominantly of young families with school age children. It is vital the council prioritises affordable housing in my ward and invests in new leisure facilities to address increased demand.

“That must include getting a move on with the new King Alfred development.”

Conservative Cllr Robert Nemeth said: “The mistake ultimately was picking a competition winner that was unable to deliver the project, and then not putting mechanisms in place, such as a deposit, that would hold Crest Nicholson to its promises. There is nothing the Labour administration can now do to force Crest to start work other than hope the public embarrassment of reneging on the deal would be enough.

“Labour allowed a similar situation to take place at King’s House where the highest bidder was picked but no deposit was taken. The deal fell apart and a year of council tax was lost. I’d now be very surprised if the King Alfred goes ahead.”

SaveHove campaigner Valerie Paynter said: “The time has come for the council to tell Crest to sling their hook. The seafront is this city’s USP and the King Alfred needs to be a hospitality site. There should be a leisure centre, community and arts space and maybe a little hotel.

“Trying to build a housing estate is obviously proving the biggest problem. The council is just desperate to deliver that great big wadge of housing the government is forcing down the city’s throat. They have been trying to force a square peg in a round hole for too long.”

Phil Graves, from leading property advisors Graves Jenkins, said: “I personally believe the entire project needs to be rethought. This is the third time an agreed deal has done a u-turn turn and fundamentally, I feel the council is seeking too much from the site what with both the state of the art leisure centre and affordable housing provision.

“Something has to give - more storeys to create greater massing or less affordable provision to make it viable.”

Geoff Raw, city council chief executive, said: “Crest Nicholson has approached the HCA with the agreement and support of the council to assist in the delivery of the King Alfred development project. Involvement of the HCA is not unusual on large and complex schemes.

“The level of affordable housing remains as set out in the original proposal. Crest Nicholson remains committed to the project and is working together with the council to move the scheme forward.”

A Crest Nicholson spokesman said: “Crest Nicholson and the Starr Trust are committed to working in partnership with Brighton and Hove City Council to deliver the King Alfred development.

“In the meantime, the project continues in earnest behind the scenes, and we’re keen to share any significant developments as soon as we can. We will continue to do all we can do to deliver the very best for the city in the timeliest fashion possible”