Tesco has launched a vigorous defence of its plans for a massive development near Sunderland city centre, which have led to a public inquiry in the city.

The retailer bought the 16-acre former Vaux Brewery site for £13m in 2002. But its plans for a £150m development, including a 110,000 sq ft supermarket, shops, homes and leisure facilities are opposed by Sunderland Council Area Regeneration Company (ARC).

The ARC wants to develop a four-mile swathe of land from the city centre up the River Wear to the A19.The derelict former Vaux site is central to ARC's plan for offices and 1,000 apartments. It believes that the Tesco supermarket could be placed elsewhere in the city.

Tesco's barrister Christopher Katkowski told the inquiry: "The ARC proposals are fundamentally unbalanced. ARC has promised a great deal but has secured virtually nothing. Critically important aspects of the scheme are in reality no more than aspirations."

The two-week inquiry was due to end this week.A recommendation will be made to local government minister Ruth Kelly, who will announce a decision later this year.

ARC has the backing of the RDA One North East. Compulsory purchase of the site from Tesco is one possible outcome.

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