CONSERVATIONISTS have welcomed the abandonment of plans for a sweeping redevelopment of York’s Castle Piccadilly site, saying “piecemeal” building has served York well for 1,000 years.

The Press revealed yesterday that LaSalle Ltd, the Coppergate Centre’s owners, said going ahead with a huge “retail-led” development next to the River Foss had become impossible since a £90 million shopping complex at Monks Cross was approved last year.

The company has instead submitted plans to City of York Council to turn the Banana Warehouse building and the neighbouring furniture and computer stores into two new shops and 37 flats. The historic warehouse frontage will be retained, but the rest of the site will be demolished and rebuilt.

Ryedale House, on Piccadilly, which LaSalle also owns, is not included in this planning application, but a spokesman for the developers said they were currently in talks with the council regarding the site. It is understood the building - which has been branded one of York's worst eyesores - could ultimately be converted to flats.

York Civic Trust director Peter Brown said LaSalle’s decision was right for the city. He said: “We welcome further development taking place on Piccadilly and are pleased so many residential units are included in the scheme.

“It has been a long-term ambition of the Trust to see more people living once more in the centre of York. We look forward to studying the proposed design in detail and hope the developers will use this opportunity to take full advantage of the river frontage.

“Some will regret that the area will no longer be given over to comprehensive development, but the Trust does not share this view. York has been subjected to piecemeal development for the last 1,000 years or so, and this seems to be the right way for the city to develop – in an organic way, responding to local needs.”

Conservative councillor Chris Steward said the abandonment of the larger Castle Piccadilly scheme was no surprise. He said: “Although it is positive news that something will finally happen in a part of the city which has long looked poor, the reality is that this is happening because, with the likes of the Monks Cross expansion, the city-centre is becoming tougher and tougher for retailers.”

The Liberal Democrats’ planning spokeswoman Coun Ann Reid said any Piccadilly improvements, particularly new homes, were welcome, but said: “Although the opportunity for a comprehensive scheme which would have seen the whole site developed has probably been lost, I feel a masterplan for the area is still needed.”