Supermarket giant Sainsbury’s has pulled out of Narberth’s controversial Old School site scheme after lack of progress by its developer, the Western Telegraph can reveal.

And its withdrawal looks to spell disaster for the project.

The retailer announced in November 2014 that it was to open one of its Sainsbury’s Local stores in the cornerstone site on the retail and housing development.

But today (Thursday), the company said it was “disappointed“ to announce that it was unable to open the new store in Narberth.

Added a Sainsbury’s spokesperson: “Unfortunately, the developer has not carried out the building work as expected and, following a review, we have decided not to progress with the scheme.”

The project for the demolition of the former primary school buildings at the entrance to Narberth’s Townsmoor car park was granted planning permission by Pembrokeshire County Council in January 2015.

The scheme featured a two-storey building, with retail units, including the one to be occupied by Sainsbury’s, on the ground floor.

It is understood that five tenants had been signed up, but they only did so on the condition that Sainsbury’s would be a feature of the development.

Twenty residential apartments were planned for the first floor, a minimum of 14 of which which would be affordable housing for social rental, to be managed by the Pembrokeshire Housing Association.

The plan was being put forward by Abbeymore Estates - an experienced retailer developer headed by Narberth resident Dave Gee - and building contractor Knox & Wells.

Townspeople who felt that the scheme was not suitable for Narberth have repeatedly called for a public consultation on the scheme, and latterly concerns have been raised about the dilapidated condition of the building and the delayed start date of the work.

It is understood that Sainsbury’s had warned the developers that they would withdraw if work on the building had not begun by the end of April 2016.

Narberth’s county councillor Wynne Evans had originally pledged his support for the project, but admitted he is now “frustrated and furious” about its outcome.

“I put my neck on the line for this one, but we are seven years down the line from the school closing and now back to square one,” he told the Western Telegraph on Thursday.

“It’s a very lacklustre effort on the part of the developer; the site looks dreadful and I am extremely disappointed.”

Councillor Evans is now hoping that the school site could be used for extra car parking for Narberth and possibly some social housing.

“I would personally like to see some small shop starter units owned by the county council which could be let at low rents to some of the very enterprising young people we have in Narberth,” he said.