Tesco has signed a controversial multi-million pound deal to build a new store in Birmingham.

The store giant is set to construct a supermarket off Hazelwell Lane in Stirchley after finally buying the land from the city council.

The land earmarked for the scheme has been at the centre of a decade-long wrangle.

Alternative plans put forward by Midlands Co-op, which has had a presence in Stirchley for more than 100 years, and developer Helical Retail were previously rejected by the authority.

But even now the deal is likely to prove far from straightforward as some of the properties in the area earmarked for the development are still in private ownership – including a house in Hazelwell Lane owned by the Co-op.

Coun Tim Huxtable (Con Bournville) said the development, discussed at a Stirchley Neighbourhood Forum meeting would revitalise the area.

“This is a huge step forward for Stirchley and something myself and my fellow Conservative councillors for the area have been working towards for the last ten years,” he said.

But residents at the meeting gave the news a more muted reaction.

Many said they feared it would “crush” existing independent shops along Pershore Road, while others feared for the future of the area’s Co-op, based less than a mile from the site the Tesco store will occupy.

Genevieve Pearson, aged 31, said: “Stirchley already has a supermarket and one that is historically linked to the area.

“I do not see why we need a giant company wading in, waving its cash around and taking over.”

Tesco has not revealed the exact cost of the land deal and did not return phone calls on the subject yesterday.

There was also no comment available from the Co-op.

The council is now set to make Compulsory Purchase Orders to buy the properties set to be swallowed up by the development, although that process alone could take up to two years.

They include the Co-op owned house, land off Hazelwell Lane and Stirchley United Working Men’s Club.

And it will take in land currently occupied by Stirchley Community Centre and Stirchley Indoor Bowls Centre, both of which will be rebuilt on new sites.

The plans will also see the former KwikSave store on Pershore Road redeveloped and a nearby reclamation yard enhanced.

The British Oak pub and Stirchley Community Church will escape the development.

Coun Huxtable said Tesco had already paid a “substantial” figure to the council as a deposit for the land.

That cash will be used to help create a new community centre on the site of the historic Stirchley Baths and the facade of the 1911 Grade II listed building will be restored.