TOWN centre traders could lose up to £35million a year in takings from the new shopping centre at Southend United’s planned Fossetts Farm development.

Research claims the opening of a 16,400sq m retail park next to the proposed Blues’ 22,000-seat stadium could affect the annual £459million turnover by as much as right per cent if customers flock to the planned new complex.

Businesses also fear the new stores could also scupper plans for Southend Council’s St John’s Quarter development proposals, of hundreds of new shops, homes and leisure facilities linking the High Street and the seafront, and lead to the decline of the high street.

A spokesman for Orchard Streets, which owns the Royals Shopping Centre, said: “At a time when challenging economic conditions are on-going, it contributes to harming confidence in the future of the town centre to attract potential investment with lasting effects on the economic growth and legacy.”

A Southend Council-commissioned report of the potential effects of the new shops on the ailing town centre by GL Hearn concluded: “The proposals will divert a substantial amount of turnover away from the town and will have a significant trading impact.”

The firm said the £6million sweetener pledged by Southend United towards town centre improvements to offset the impact in 2008 was now more important due to the decline of the high street.

Despite the warning councillors agreed on Wednesday to accept a reduced contribution from the club and development partner Sainsbury’s of £3.5million and negotiations continue over when it will be paid.

The Orchard Streets spokesman added: “To hear that the £6m contribution is now being drip fed and reduced substantially at a time when it could really make a difference, will inevitably be at the detriment to the town centre.”

In a letter to the council Orchard Streets wrote: “As there will simply not be adequate retail spending power to support both proposals, approval of Fossetts Farm would inevitably bring proposals for St John's Quarter to a grinding halt.”

GL Hearn’s report argued that due to delays with the stadium the St John’s Quarter and Fossett’s farm developments would be competing for the same investors and retailers.

Consultants who studied the impact on behalf of the football club argued Fossetts Farm would complement the town centre.

Savills carried out a retail impact assessment and calculated town centre turnover would drop less at between £19million an d £25million when the stadium complex opens.

The firm said it believed the St John’s Quarter development could still also go ahead. Its report said: “We have demonstrated that the proposed development at Fossett’s Farm will complement rather than compete directly with the town centre, particularly in respect of potential tenants.”

It added the units at Fossetts were larger than in the town so would attract different retailers.

Referring to St John’s Quarter, it added: “The two developments will meet some qualitatively different requirements and formats and therefore direct competition for tenants will be limited.

“There is no evidence to suggest Fossetts Farm would have an adverse effect on the realisation of St John’s Quarter.”