A multi-million-pound plan to bring a neglected listed building back to life has been thrown into doubt after the government turned down the city’s £20 million bid for levelling up money.

The former grade II-listed Engine Works in Shrub Hill Road in Worcester would have been transformed into “landmark” offices and creative workshop space.

The city council’s plans for the 7,000 square metre building, which is more than 150 years old and said to be in a “very poor state of repair,” would also have seen its leaky roof replaced.

The government’s levelling up secretary Michael Gove announced on Thursday (January 19) that Worcester’s multi-million-pound bid, which also included huge improvements to Worcester Racecourse and Nunnery Wood Sports Complex, had been rejected.

Worcester MP Robin Walker said he was “deeply disappointed” by the snub of the city – and particularly the loss of money for Shrub Hill.

“I confess I am deeply disappointed that two bids relating to Worcester have been rejected,” he said.

“I thought that the focus on active travel and improving transport connections in the county bid was particularly strong and complimentary to the investment already secured in the Shrub Hill area.”

West Worcestershire MP Harriett Baldwin had suggested that unsuccessful authorities should ‘put in better bids next time’ – to which Mr Walker said there was “no problem” with how the city had bid for ‘levelling up’ money.

“There are going to be winners and losers in every competitive bidding process, and we can’t win every bid,” he said.

“There is no problem with [Worcester’s] bidding process. The city has shown this before and has been successful in bringing in funding from other bids.” Cllr Chris Mitchell, leader of Worcester City Council, said the rejection by ministers would not “jeopardise” the work but the city would have to look at other ways of funding it.

The plans for the large Shrub Hill building, which is owned by Worcestershire County Council, were one of several long overdue regeneration projects for the area.

Last year, councillors backed a £10 million plan which would see former ageing NHS offices Isaac Maddox House in Shrub Hill Road become a new business hub.

The redevelopment plan for the neighbouring canal-side site also includes new housing and a walking and cycling route from Shrub Hill to St Martin’s Quarter.