THE developer behind the multi-million pound Walkergate says it expects work to start by the end of the year.

The scheme, part of the city centre regeneration that includes the £30m Millennium City development - home to the Gala Theatre - was originally planned to be open this year.

But the start of work on the derelict car park site has been delayed several times and the shape of the scheme has been altered.

Early ideas, such as a multi-screen cinema, have been dropped and the development will now include a multi-storey car park, hotel, restaurants and bars.

The firm says there have been delays in reaching agreement with tenants for the development.

The outcome of a public inquiry, held earlier this year, into whether part of The Sands can be used as a temporary car park during the two-year construction period, is still awaited.

In the past, traders in the city have expressed concern that the loss of parking spaces at Walkergate, without anything to replace them, could deter drivers from coming into the city and would hit their trade.

Residents of The Sands are opposed to the use of the site.

Dan Needham, of developer Amec, said there had been delays in securing agreements with tenants of the bars and restaurants but agreements were 'very nearly completed' and work was expected to start by the end of the year.

Durham City Council leader Sue Pitts told a meeting of the full council: "The delays to the Walkergate project were, as they always have been, in the hands of the developer. It is entirely up to Amec when the work starts. The current start date is now November. I understand that the delays have been caused by the need to have future tenants signed up and that this has now been achieved but certain conditions still have to be agreed.

"You will have noticed that equipment has already been moved on site."

She said that the expected timescale of the development was unaltered at two years.

But Labour spokesman Mike Syer said: "The implication seems to be that the council has no control, or seems not to be seeking any control, over the situation.

"It has got to be a worry that the development still has not started. I don't know what financial implications there are for the authority.''