A DEAL has been struck that could see Southampton's dilapidated Bargate Shopping Centre torn down and replaced with a thriving complex of businesses and homes.

The Daily Echo can reveal that an agreement has been reached for a new developer to take control of the site, potentially paving the way for hundreds of new jobs to be created.

And while Bargate Ltd's proposals are at a very early stage there are hopes the decrepit building could be demolished to make way for dozens of businesses and hundreds of homes.

The centre was originally opened 27 years ago and was designed to be the heart of the city's shopping precinct.

But in recent years it struggled after the opening of the nearby WestQuay Shopping Centre and its last businesses left before it was boarded up in June 2013.

As reported by the Daily Echo a consortium of American investors then bought the 1.5 acre site, and had been in discussions with a developer to sell the site off last year.

However that deal collapsed and the consortium went into receivership before a deal was concluded this summer allowing Bargate Ltd to acquire the former owner's loans and take control of the site.

The team behind Bargate Ltd has experience in bringing forward real estate developments across the country and has been involved in the creation of office complexes in London and Liverpool and retail developments in Surrey, Kent and the West Midlands.

James Burchell, from Bargate Ltd, said: “We are looking forward to fully engaging with all stakeholders in respect of this opportunity, which lies in the heart of the city and at what is an exciting time for Southampton.

"Given the investment that has been attracted to Southampton from both central Government and the private sector of late, the regeneration of the former Bargate Shopping Centre site will only further make a positive contribution.

“It is our intention to bring this site back into a positive use with a firmly viable mixed-use development. While we have developed some initial thinking for the site’s future, we have yet to finalise these plans.

"We look forward to talking to local residents, businesses and local representatives over the coming months as part of working up a deliverable set of proposals.”

The developer is now discussing the future of the site with the city council, and authority leader Simon Letts, pictured below, has said he hopes the new complex will feature vintage firms and a different atmosphere to allow it to complement WestQuay Shopping Centre as well as an alternative shopping destination.

Daily Echo: Council leader Simon Letts.

However the plans are at a very early stage with detailed proposals only likely to come forward towards the end of the year.

Architects are set to be appointed in the next month before public consultation starts following the end of the summer holidays.

Cllr Letts says the council wants construction work to start on site within two years, and that the developer has been granted a "business rates holiday" for the next two years.

He said he hopes the plans will see the current building torn down, and that the new development could feature a "boutique hotel" as well as retail and housing.

He said: "The most important thing for us is to open up the city walls and instead of just being sat in a back street they become part of a decent piece of public open space so people can walk from the Bargate through to the new development."

“After previous disappointments, the fact that a new company is now taking the Bargate site forward is testament to Southampton’s continued attractiveness to investors. I am looking forward to working with Bargate Ltd and seeing their plans develop over the coming months.”

Royston Smith, Southampton Itchen MP, pictured below, also welcomed the announcement, saying: "Southampton was doing very well during the recession, bucking the national trend.

Daily Echo: Cllr Royston Smith oversees the demolition work on the old C&A buliding, Above Bar, Southampton. (26130606)

"However, there has been very little progress in the last few years.

"The old Bargate Shopping Centre is in desperate need of redevelopment, it really is looking very shabby now.

"I hope we are finally going to see a development here that Southampton can be proud of."

Stewart Dunn, chief executive of the Hampshire Chamber of Commerce, also welcomed the deal, saying: "I think it's good news in that it gives us a good opportunity for Southampton to take the chance to compliment the city's heritage against the Bargate and its walls and provide a different offer to WestQuay.

"I hope it will also give the opportunity to bring further residential units and act as a conduit and link to East Street.

"I hope that this will bring a further boost for employment which is always welcome.

"It's another piece in the jigsaw, and with the Royal Pier development WestQuay Watermark you will have a triad of three major developments."