PLANS to build a £15m centre for the UK rail industry in Derby have been scrapped.

The UK Rail Centre was intended to provide a showcase venue for the industry but the East Midlands Development Agency admits it has failed to attract investment for the project.

A scaled-down version of the rail centre is now being discussed.

Derby beat York for the right to be home to the landmark building in 2005 and a year later Emda spent £1.95m on a 2.6-acre site on Pride Park close to the railway station.

Designed by Derby architects ADDC, the centre would have featured a 200-seater auditorium, an exhibition hall, meeting rooms and a rail link for demonstrations and testing.

The annual operating costs were estimated at £939,200.

Emda had allocated £4.5m from its budget to build the centre with the intention that the rest of the cash needed would have come from the private sector and European funding.

Mike Carr, executive director of business services at Emda, said: "A large amount of work went on for two or three years to put together the concept and business plan.

"It suggested that it could be viable but needed the right partner."

According to Mr Carr, it was after the land purchase that the plan started to run into difficulties as additional investment proved elusive.

"We explored the public and private sector and the rail industry and, because of the size and scale of the project, came to the conclusion that the rail centre as described in the business plan was not economically feasible," he said.

The intention for the £15m rail centre was for it to be a conference, exhibition venue and a shop window for rail firms to welcome international visitors, demonstrate what the UK rail industry had to offer and drive exports.

A 32m-high ventilation tunnel the shape of a traffic cone would have made it an instantly recognisable landmark for the city.

Discussions are under way about scaled-back plans and Emda has confirmed that there are plans to use the land – the details of which are commercially sensitive.

Michelle Craven, vice-chairman of the Derby and Derbyshire Rail Forum, said: "It is a disappointment that this showcase for the rail industry isn't happening but we have had discussions with Emda about what we can do instead.

"Derby has the highest concentration of rail companies in Europe and many haven't got the facilities to accommodate groups of trade importers from overseas, so there is still a need."

Derby was chosen by the Railway Industry Association and the Rail Sector Advisory Group ahead of York for the right to house the centre.

Derby Cityscape was involved in the bidding process alongside Derby City Council and Emda and also played a part in selecting the site for the project.

Its chief executive John Cadwallader said: "I think for it to have been successful it needed ongoing revenue support and Emda needed that to come from the rail industry.

"To make it viable it also needed an operator to take it on," said Mr Cadwallader.

Mike Wood is a director at Derby architects ADDC, the firm that designed the centre.

He said: "It was a thrilling opportunity for Derby to have a national centre coming here and it is a shame that it hasn't materialised because Derby, for many people, is the home of the rail industry."

John Forkin, director of Marketing Derby, said: "I'm not sure that the project ever had a really clear focus and the current state of the economy made a business case difficult.

"However, the arrival of The Roundhouse campus only yards away with significant conferencing capabilities has probably superseded the rail centre requirements."

No one from the Railway Industry Association was available to comment.