A top-level study is calling for a huge new department store to be built on York's Castle Piccadilly site to boost flagging city centre trade.

But the study, by consultants Roger Tym and Partners, says any development in the area must be "more sensitive and scaled-down" than the controversial Coppergate Riverside scheme, which was thrown out by the Government last year after a lengthy public inquiry.

And it must incorporate a high quality civic open space, particularly in the area closest to Clifford's Tower and the Castle Museum.

The report was commissioned by City of York Council to identify how the city's shopping area should develop to remain healthy in future, and investigate issues raised by the Coppergate Riverside planning saga.

The report confirms that the city centre is healthy, but reveals that it has slipped down the rankings of shopping destinations since 2001 from 16th to 24th, when its main competitors - Harrogate, Leeds and Hull -all improved their positions.

It says the situation would be improved by addressing key omissions from York's offer - a large, modern department store, a new-style city centre supermarket such as Tesco Metro or Sainsbury Local, and other high quality fashion stores.

The consultants say there is limited potential for providing this amount of development within the existing city centre core, and a well-planned extension to the core is required, with Castle Piccadilly the best location. They said a sensitive and scaled down scheme could actually enhance the setting of the tower and nearby historic buildings.

Bill Woolley, the council's acting director of environment and development, said today that the study raised some interesting points, but stressed that it would be only one of many influences when a draft planning brief was drawn up for the site. The report will be discussed by councillors next week.

Darrell Buttery, chairman of York Civic Trust, one of several organisations which successfully fought the Coppergate Riverside scheme, today welcomed the call for open civic space near the tower.

But he spoke of his concerns about the difficulties of building a large department store, with associated activities from lorry turning areas and wheelie bins, in the sensitive area near the Foss.

Asked if this was the compromise solution to York's problems, he said: "Compromises sometimes work, but they can sometimes lead to really banal solutions."

He said outstanding modern architecture would be needed.

Philip Crowe, of another campaign group, York Tomorrow, welcomed the recognition of the need for civic open space, but said this should encompass the whole site.

Updated: 14:16 Tuesday, October 12, 2004