A HIGH street giant has pulled out of a new flagship store in a Hampshire town just months before it was due to open its doors.

Fareham's council leader has described the decision by Debenhams as a "devastating" blow to the town, but hopes a deal can still be done to ensure the shop is eventually opened.

The new department store was heralded as an exciting development for Fareham, creating 100 new jobs and breathing new life into the town's shopping facilities.

But last night it was revealed the firm will not be opening the shop in July, blaming a "contractual dispute" with the owners of Fareham Shopping Centre, Dominion.

Daily Echo: Click below to see a video of today's headlines in sixty seconds

Less than two weeks ago, around 400 people queued up outside the store to apply for the 100 jobs it was creating.

Yesterday, all those who had been told they were successful received the nightmare news their new positions no longer exist.

Centre manager, Pam Gillard, said she hopes Debenhams will still take up the purpose-built 20,000 square foot store, which is adjacent to a new car park.

"This is in the hands of the owners and their advisers, who are endeavouring to bring this to a successful resolution for all parties," she said.

"Once this is resolved we will keep shoppers in touch as our plans develop."

Fareham Borough Council leader, Sean Woodward told the Daily Echo the authority would also do all it can to help the two firms come to an agreement.

"We had got to the stage where Debenhams had taken possession of the unit and have been fitting it out, but now they've pulled out," he said.

"I don't know if it's a victim of the recession or something else, but there is a contractual dispute between the two parties.

"It's obviously very disappointing, both for the people who had job offers and those who were looking forward to a new store in Fareham, which would have brought a new offer to the town.

"A lot of the new employees had worked for Woolworths, and now within a week of being told they had a new job, they've had another letter saying they haven't got one."

"Obviously we will do what we can to bring the two parties together, and hopefully get a new solution.

"The council is the owner of the land that the centre stands on, but it's Dominion that owns the centre itself."