TALKS have resumed to find a tenant for the former Lo-Cost site in the centre of Haslemere.

After a breakdown in negotiations last year between the Co-operative Group and Mackays, the High Street fashion chain, another High Street non-food retail store is in talks over the shop.

A spokesman for leaseholders the Co-operative Group, said that discussions were taking place to take part of the 5,000 sq feet of floor space available.

"We are not prepared to say any more as we have to look at the commercial viability of this proposition and whether the landlord is prepared to accept a special arrangement.

"We should know the outcome within the next month," he added.

The company secretary for Mackays head office in Scotland, Matt McKimmie,confirmed that the store had definitely backed out of plans to occupy the former supermarket.

"The terms were not attractive enough," said Mr McKimmie this week.

He blamed the breakdown of talks on the Co-op demanding too high a rent on a building that was not in good-enough condition.

The building, owned by the largest company in Europe, Axzo-Nobel, is on a 99-year lease to the Co-operative Group which runs out in 2071.

Last year the group pulled the plug on talks with the Haslemere-based bedding shop Lane of Nod at the last minute and Mackays dropped out of a deal at the end of last year.

Lo-Cost closed its doors more than five year ago and despite speculation about its future ever since, the building has remained an empty shell.

Last week, mayor Fay Foster, addressing the annual town meeting, expressed concern about the number of empty properties in Haslemere and hoped that new tenants could be found quickly for the former Lo-Cost shop.

In Wey Hill, the Alldays store is planning to close its doors and the lease is up for sale.

The closure of the convenience shop, is blamed on a loss of trade following the opening of Tesco's.

"Tesco has slowly but surely impacted on the shop and it is no longer viable," said Mark Isherwood, director of the Guildford-based agents Wadham and Isherwood.

Mr Isherwood said that there was disappointment after a High Street furniture retailer had recently backed out of discussions on the 3,000 sq.ft. shop.

"There has been quite a lot of interest from a variety of traders in the shop over the last four or five months," said Mr Isherwood.