DEMOLITION of a historic Peeblesshire mill appears increasingly inevitable, councillors have been informed.

Innerleithen’s Caerlee Mill was earmarked for a £19 million mountain bike innovation centre after it was bought by South of Scotland Enterprise (SOSE).

But conversion plans faltered when significant structural issues were identified.

Paul Cathrow, a senior executive with SOSE, said the development agency was proposing to flatten the mill.

“We would be looking at £17m just to keep it as a shell of a building and we came to the conclusion that it is very difficult to see a viable future for that building,” he told a meeting of Tweeddale Area Partnership on Tuesday (October 29).

“The overwhelming feedback that we had from the community meeting, which was really reassuring, was that people want to see the Carelee Mill site being brought back into use – and I stress the site, not necessarily the building.

“There is a general feeling of sadness that the building will be lost and that’s what we are proposing now, a demolition process for that building and it is a listed building. There is a sadness but a general understanding that that is the position we are in.

“As a project we now have two or three options. We have an option to try and look for funding to try and find £30m to salvage the building, which is not very well supported as you can understand in the current climate.

“The two other options form around the demolition of the building. We would need to seek listed demolition consent, which is not a straightforward process, and then we have an option to rebuild an innovation centre on site or build an innovation centre somewhere else within the Innerleithen area.”

The multi-million pound centre is a flagship Borderlands Growth Deal project.

It has been predicted to generate more than £100m for the local economy and create around 400 jobs in the next 10 years.

SOSE secured planning permission for the 18th-century mill in 2023.

Although the site has been fully decontaminated and made safe, issues were much more substantial than the initial surveys indicated, with the technical advice now being that the majority of the historic structure needs to be replaced.

Such work would push the costs significantly above the available budget.

The building would cater for a wide range of activities, including bike design, testing and manufacture of bike components and accessories, as well as training and support facilities for elite riders.

Caerlee Mill was built by Alexander Brodie in 1788 and added to over the years.

It was the first water-powered textile mill in the Borders.

Its success led to a great increase in the local population from 463 in 1841 to 2,313 by 1881, and at its peak it employed about 400 workers.

A management takeover saved the site in 2010 but it closed for good in 2013, at which time it was Scotland’s oldest continually operating textile mill.