Caistor council has backed out of plans to buy the town’s former Lincolnshire Co-op store after initial reports highlighted several issues.
Back in October the council voted to proceed with plans to buy the building with a £325,000 public works loan and create a community facility.
But councillors made a u-turn at a closed meeting last Thursday.
Council clerk Helen Pitman said the decision was down to “a number of issues” which could jeopardise the project - but has not revealed exactly what the issues are.
In a statement, she said: “At the December meeting, Caistor Town Council reluctantly resolved not to proceed with the purchase of the former Co-op building, pre-feasibility work having highlighted a number of issues which council felt may jeopardise the project.
“However, council is still keen to see the building brought back into use and would like to offer support to anyone willing to undertake the work.
“There has been no expense to the council tax payer as all investigations and work have been covered by grant funding.
“Council wishes to thank all those residents who showed overwhelming enthusiasm and support through the public consultation process.”
At October’s meeting several councillors had expressed concerns about the project after being advised it was highly unlikely they would be able to attract more health facilities like a dentist or opticians.
Coun John Burns-Salmond told the meeting: “I do have some reservations about costings, they are very vague still.
“I’m fully in support of the project and would like to see it happen as soon as possible but I’m slightly worried about what we’re getting ourselves into.
“I would be worried about putting such a lot of money into a building I have nor fully looked into, what will the cost of management be?
“What income will it make?
“I’m worried we’re galloping along faster than we should be.”
The renovation had been due to create two residential flats, as well as office space and small start-up business units.
More than 100 residents went to a public meeting about the project and the plans were approved by 90 of people.
Had plans gone ahead, the council’s precept would have increased from £77,883 to £94,583 - equivalent to an extra 34p a week for a band D property.