INVESTORS have pulled out of plans to develop the old Sainsbury’s site in Newport claiming they are “exasperated” after attacks from vandals and thieves.

The Fear Group wanted to redevelop the former supermarket site, on Wyndham Street, into a 601-bedroom student housing complex, 142 flats and a hotel as part of a £60 million regeneration scheme.

It was hoped work would begin this year after outline planning consent was given in November.

But after “focused and well-equipped” arsonists set fire to the building in the early hours of yesterday morning, company director Stephen Fear said he will be selling the site.

In a statement sent to the Argus he said: “Vandals and thieves had already done nearly a million pounds worth of damage to the building prior to this fire. We are exasperated!

“It is with great sadness that we have finally come to the conclusion that our investment and involvement in the area generally has come to an end and as a result of all of this we now intend to sell the site in due course.”

In his statement Mr Fear lists problems that he, his son Leon and company staff have encountered at the site including threats to kill their security guard, burn the guard's caravan and kill his dog.

Mr Fear, who bought the site in 2010, said: “Both Leon and I have been personally threatened on several occasions when on site and have grown weary of it all after nearly six years of battling one party after another, despite trying to create something wholly positive for the city of Newport.”

He said despite spending £300,000 on the application, work was delayed because Natural Resources Wales had not yet signed an agreement.

Tim England, flood risk manager for Natural Resources Wales refuted such claims, saying: “We have worked closely with the group over the past 12 months to ensure their development and our flood scheme goes ahead.

“The legal agreement has taken time to finalise but there have been no delays during the process.”

Crews from all across Gwent including Aberbargoed, Cwmbran and Newport were called to the derelict building at 1.36am on Thursday morning after it had been deliberately set on fire.

A Gwent Police spokeswoman confirmed that there is an ongoing investigation and that no further comment will be made at this stage.

Officers have reportedly spoken with the victim of the alleged assault and have provided an 'update on the progression of this case'.

Mr Fear thanked the fire service for their “quick attention and professionalism”. He also thanked local residents and city councillors who he had said have been “mostly supportive”.

“Newport has great potential as a city and its strategic location should have secured its prosperity many years ago,” he said.

“Under new council leader Debbie Wilcox we feel Newport will prosper, but with threats of violence to ourselves, our staff, and now another apparently calculated and deliberately vicious attack on our property we have decided that we have had enough.”

Leader of Newport City Council, Councillor Wilcox said she was "disappointed" to hear of the Fear Group's decision.

She added: “I’ve called Mr Fear personally and left a message for him while the council’s strategic director for place is also contacting him to discuss what, if anything, we can do to enable this much anticipated and important regeneration scheme to proceed."