Negotiations to move the town’s health services to a single site in Townstal have collapsed.

Torbay and South Devon NHS Foundation Trust has failed to secure a lease on the chosen River View property after the owner turned down a rental offer and demanded more money. However, the trust says it remains committed to providing the health facilities it promised Dartmouth.

Following the closure of Dartmouth and Kingswear Hospital, the trust had proposed to create a centre at the River View nursing home, with plans having been ­submitted for planning permission.

Doctors, the outpatient clinic and Dartmouth Caring were all to move to River View, where six hospital beds and a care home would be managed by a new nursing home operator selected at a recent tender.

Trust chief executive Mairead McAlinden said in a joint statement, released on Wednesday, January 10, from all those involved: “Following many months of planning and negotiation, the trust has been unable to agree with the owner of River View a reasonable price for its lease for the development of the health and well-being centre in Dartmouth. However, work is already under way to ­identify an alternative solution.

“Plans to locate the new centre at River View in Dartmouth cannot now proceed following the rejection by the building’s owners of an offer of £225,000 per year for a 35-year lease of the building, amounting to almost £8m over the life of the lease.”

Dartmouth Caring manager Nick Hindmarsh said: “The trust’s final offer was some way below the rent it had originally said it would pay. This may explain why the landlord rejected the proposal.”

Ms McAlinden said: “Before Christmas, the trust made a final offer to the building owners that it and its partners felt was the maximum possible and that, with support from the trust and Devon County Council, would be acceptable to the partners to the lease.

“Unfortunately it was rejected by the owners, U and I Group plc, and so the trust and its partners have no option but to develop an alternative solution.”

Pierre Landell-Mills, of the Dartmouth Patients Group, said: “My reaction is shock. The offer was reasonable but they still turned it down. The landlord says they can find a care-home provider to run River View as an 80-bed nursing home.

“We don’t believe there’s the demand in Dartmouth for an 80-bed care home.

“The trust has worked hard on this for a year, but is faced with unco-operative owners. They’re asking for more than can be justified. The trust is assuring us it will provide what it promised.”

County ­councillor Jonath­an Hawkins said: “When the hospital was discussed for closure, the NHS would have been in a stronger position in the negotiations if any replacement had to be open before the ­closure took place. The ­proceeds from the sale of the old hospital must be ringfenced.”

Ms McAlinden said: “With the support of Devon County Council, we’ve stretched our offer to the maximum affordable to all the partners – this is a significant amount of public money and we ­couldn’t subsidise the extra that was being asked.

“This decision is disheartening to the trust and our partners, Devon County Council, Dartmouth Medical Practice, Dartmouth Caring, Dartmouth Town Council and the League of Friends, and the many elected and community representatives who have given their time and expert advice.

“I appreciate how ­disappointed the people of Dartmouth will be, but we’re already looking at other ­locations. Of course the building is important, but I want to assure the people that the additional community staff and services we’ve made available to support people in their own homes, as well as the intermediate care beds in local care homes, are meeting the needs of the people of Dartmouth. These services will continue to provide excellent care from their current facilities while we develop our plans for the new centre.

“The trust and South Devon and Torbay Clinical Commissioning Group remain determined to deliver a health and well-being ­centre in line with the commitments made during the consultation in 2016, and this will happen. All partners will now be considering alternative options, which included new accommodation for the Dartmouth Medical Practice, Dartmouth Caring and trust, health and care staff; clinics currently provided in Dartmouth; a pharmacy; end-of-life care; and access to intermediate care services and rapid-response multi-disciplinary teams.

“The trust and county council are also working with High Trees, the care home operator, to make sure the continued care and safety of the current ­residents at River View remains a priority.”

MP Sarah Wollaston, who is chairman of the House of Commons Select Committee, said: “I’m deeply concerned that the owners have refused to accept the final offer. It comes as a huge blow to the community and to all those who have worked so hard.”

The partners included in the development of the centre include the trust, GPs, Dartmouth Caring, South Devon and Torbay CCG, the patients’ group, the League of Friends of Dartmouth and District Healthcare, Devon County Council and town and parish councils.

Mr Hindmarsh from Dartmouth Caring, who chairs meetings of the partners, said: “While we’re all disappointed by this turn of events, it’s only served to unite us in finding an alternative, high-quality solution as quickly as ­possible. We know from the monitoring information we review regularly that current services are working as well as, and usually better than, before the hospital closed in meeting the needs of local people.

“Our focus now must be on developing plans to provide a health and well-being centre for Dartmouth in the shortest possible timescale.”

Matthew Potter, senior asset manager at U and I, said: “It is unfortunate that no deal has been reached. Terms were agreed for several months and later changed by the NHS, so we were unable to progress with the proposals.”