Magpie Recycling faces having the rent for its site tripled.

The co-operative has been told it will have to pay £15,000 a year to carry on renting the depot which has been the group's base for ten years.

Brighton and Hove City Council, which owns the land at Saunders Park, Lewes Road, previously charged the co-op £5,000.

Jock Ledger, from Magpie, said staff knew the rent was being reviewed but did not expect the increase to be anything like as high.

He said: "For a group like ours that runs on a shoestring it is a bit more of a hike than we had hoped for.

"We are going to struggle. A rent increase of that sort makes it very difficult."

The co-op, which has more than 4,700 customers in Brighton and Hove, has always used Saunders Park.

The depot was derelict before Magpie moved in and the council won government funds intended for recycling initiatives to renovate the buildings.

The council said the rent rise had not yet been fixed.

A spokeswoman said: "It was always very clear from the outset that it would be reviewed to open market rates.

"If they are concerned or unhappy about it we hope they will come back to us to discuss it further."

Joyce Edmond-Smith, convenor of the council's sustainability commission, said she would look into the size of the increase.

She said: "It is certainly cause for concern. They are doing things that we want them to do and we don't want to put them out of business."

Magpie has recently finished refurbishing the depot and came up with a Shabitat sign to mark the end of the project.

Mr Ledger said: "After we redecorated the building we decided we would come up with a new name for the building and somebody came up with Shabitat."

A spokeswoman for Habitat said: "We are delighted Brighton is embracing recycling.

"Obviously Magpie Recycling is in no way associated with Habitat - it is simply a coincidence its new name sounds similar to ours. We wish Magpie well with its ventures."