A “concrete monstrosity” set to be built in Staines could be scrapped after housebuilder Taylor Wimpey warned council officials it does not have the cash to continue – meaning the authority could lose £10m.

Planning permission was given to Taylor Wimpey to develop Bridge Street car park into a seven-storey block of 143 flats two weeks ago but it is rumoured the developer will pull out of negotiations - despite Spelthorne Council budgeting for the cash and overriding a mountain of protests against the plans.

Leader of Spelthorne Council John Packman said he did not know if Taylor Wimpey, which recently saw its share price drop 93 per cent in a year, would buy the site because of the current economic downturn and said the council would be careful before putting the site out to tender.

He said: “It is a tremendous disappointment as we were progressing nicely and then this bombshell hit us and put us behind. The length of time has caused us a tremendous amount of heartache and it did put us back to square one.

“Taylor Wimpey has invested a lot of time and money surveying the site and turning out plans and that has to be taken into consideration and we have entered into an agreement with Taylor Wimpey. Also in the current economic climate would any housebuilders take the site?”

It was expected the council would sell the site two years ago for a rumoured £10m and the expected profit was put into the budget.

The Staines Guardian understands Taylor Wimpey demanded planning permission be granted by January or it would pull out.

Campaigners against the plans greeted the news as a temporary reprieve.

Anne Damerell, of Staines Town Society, said the group already had concerns over how planning permission was granted.

Mrs Damerell, who described the plans as a “concrete monstrosity”, said: “The council had a vested interest in this site as owners and we have some very deep concerns about the way this was handled. But this must be good news as this development is totally out of keeping with the area.”

Spelthorne Liberal Democrat chairman Diane Appleby called for the council to take more pride in the design and stand up to developers.

She said: “This is our land. We should have the confidence to go back to the developers and get a unique design for this site.”

Despite the pessimism from Spelthorne Council’s leader a spokesman for Taylor Wimpey would not be drawn on whether or not it would be forced to pull out.

A spokesman for the company, which has been in talks with Spelthorne Council since 2006, said: “Following our success in obtaining a resolution to grant planning permission, we are now progressing the scheme towards the next stage."