The day before a decision was due to be made on plans to build 1,950 homes at the Stanton ironworks site, applicant and land owner Saint-Gobain PAM withdrew its application.
In a statement the company said it felt there was no other alternative than to withdraw because it was clear a refusal by Erewash Borough Council was likely to be the outcome.
A list of 11 reasons why the plan should be refused were drawn up in a report by council officers.
The future of the brownfield site is unclear at this stage but Councillor Mike Powell, lead member for regeneration and planning, said it was still a pivotal site which the council wanted to see used for homes, businesses and green space.
He said: “They (the applicant) decided they wouldn’t get anywhere, it doesn’t mean we are not having Stanton - we want the housing, jobs and will have to see what we can do to encourage that, but not at any price.
“It has got to reflect what the community wants, with a complete mix of residential areas, open space, employment opportunities and a business park of at least ten hectares.
“We have made a commitment to residents that we will protect greenbelt. Stanton is still a pivotal site, for Ilkeston in particular, but the borough in general.”
The application had attracted a number of objections on issues such as access and transport, and the officers’ report did not find satisfactory measures to deal with these issues.
The report also found the plan did not have the right mix of green space and employment opportunities.
Saint-Gobain said it was aiming to resolve the points by September so it was a shock when the council said it wanted to make a decision in July.
Though the council is in discussions with the French firm, Coun Powell said he does not think anything will happen until the outcome of new planning policy on brownfield sites, recently announced by the Government.
A spokesman for the developer said a decision on what to do next has not yet been made but one option was not to redevelop the land. Other possibilities include resubmitting a version of the current application. Saint-Gobain will review its options in September. A number of businesses are currently being run from the site on a temporary basis.
In its statement on withdrawing the application, the company said: “Despite having worked together with the council throughout the application process and addressed all 11 key concerns of the council, it was clear that a refusal was likely to be the outcome, so we felt there was no other option.
“If successful, development of this site would have created 2,000 new and affordable homes for the area, supporting the local housing policy to address the current housing shortage.
“It would have created 22 hectares of employment land, as well as supported the need to preserve green belt areas by redeveloping existing brownfield sites.
“We believe the use of this site would have positively impacted the community. We will be considering all future options in respect of the site.”
Coun Powell added that as long as any planning application is in line with council policy Stanton will happen.