DEVELOPERS of the Sea Lanes project have been told they must decide on a 150-year lease before their short-term contract is over.

The consortium’s plan was initially to build a 50m open-air swimming pool at the derelict Peter Pan playground site on Brighton seafront.

But the group pulled the plug on a £5 million 150-year lease because of the uncertainty looming over the future of Madeira Terrace and its arches.

Instead, the Sea Lanes group has asked for a five-year temporary contract on the space with the option of taking on the longer lease at the end of the five years. They have also reduced the pool size down to 25m.

A Brighton and Hove City Council policy, resources and growth committee meeting decided the consortium must make a decision on the longer lease before the five years shorter version was concluded.

Developers are hopeful the site will be ready for use by the end of next May.

At last week’s meeting, Councillor Garry Peltzer Dunn said: “We are not granting a five-year temporary lease.

“We are actually granting a five-year lease. A lease is not temporary.

“Could I know, in the five-year term, when the option has to be taken up for the 150-year lease?”

Nick Hibberd, the council’s executive director economy, environment and culture, said: “The option has to be taken up before the end of the five-year lease.”

The consortium’s plans will see a huge redevelopment of the area, with a complex being built along with the open-air pool which will include shops, restaurants and offices.

Cllr Andrew Wealls asked what would happen if the Sea Lanes “went bust” before the five-year deal was over and whether the group would be compelled to reinstate the site if they do not go through with the plan.

Mr Hibberd responded: “Yes, they will be required to clear the site at the end of the five year term. If they were to go into administration we would be negotiating with the administrators to recover any costs of clearing the site.”

The meeting heard that if the consortium chooses to take up the 150-year lease after the five year contract, the rent will be based on the valuation of the site at that time rather than the price they originally get it for.

The uncertainty around the future of Madeira Terrace is one of the main reasons for the consortium choosing to scale down to a five year contract, and this issue was raised by Cllr Phelim Mac Cafferty. Mr Hibberd said: “I don’t think the developers are saying the lack of refurbishment of the terrace is the only reason they want a five year lease.”