BLACKBURN businesswoman Margo Grimshaw believes a hotel could restart her ailing town centre development.

The pub supremo said she wanted to shift the focus away from flats and claims a number of budget hotel chains have expressed an interest.

The £15million Cathedral Village scheme originally included 79 apartments, 13 shops and an underground car park on the site of Ms Grimshaw’s former bars and nightclubs The Castle, C’est La Vie, Never Never Land and Mr G’s.

But the site has been deserted since work stopped in August with bosses blaming the credit crunch.

Now Ms Grimshaw has said a hotel could be built on the site of the final and largest phase of the development instead of 65 flats.

The move would require a new planning application to use the site as a hotel.

Ms Grimshaw said: “I don’t think we will go down the flats route the way things are.

“It’s not definite, but we are considering other options.

“I have had one or two budget hotel chains get in touch.

“We would build it or if they thought they could build it cheaper they could. I think the town hall would co-operate.

“We have already had discussions about planning permission.

“Blackburn needs a hotel and I think it’s very well suited. We also have a car park underneath and it’s near the railway station.”

Shops would be built on the bottom floor of the development, she added.

Council bosses, who say they support Ms Grimshaw’s project, are hoping to secure two new hotels on the site of their £70million Cathedral Quarter project, which is next to Cathedral Village.

They insist their scheme, which also includes apartments, shops, cafes and a health club, will still go ahead despite the problems facing the property market.