The 400-acre business, leisure and residential centre at Cherrywood, Co Dublin is stalled following Wednesday's meeting of Dunloe Ewart.

The failure of shareholders to approve the €63.8 million purchase of British Land's 50 per cent shareholding in the development means funding difficulties will prevent further development of the prime site.

However, the director of British Land who is responsible for the company's activities in the Republic, Mr Cyril Metliss, said he was "totally relaxed" about Wednesday's developments.

"There is nothing wrong with the site and we can just sit there and let it mature. It is small beer to us, the motorway will be built, the Luas maybe, things can only get better. It is one of the best sites in Ireland."

Mr Metliss said British Land decided to sell its interest in the site because of differences of views with Dunloe chairman, Mr Noel Smyth.

"Noel's okay but he's not the easiest of personalities to get along with. He likes to run his own shop and that was one of the motivations [for British Land selling its interest\]. There is no real problem between Noel Smyth and myself. I just came to the view that over the next few years it would be best for him to do it in his own way."

A key difficulty was over the issue of funding. Dunloe wanted to use borrowings but British Land wanted to use equity. British Land decided "that perhaps it was better if he ran the shop on his own and in his own style".

This led to the agreement that shareholders rejected on Wednesday. The deal was voted down by 162 million votes to 122 million, with shareholders holding a further 104 million shares not voting.

While British Land is relaxed about sitting on Cherrywood, the stalling of the project is more problematic for Dunloe. "For Dunloe it's not good to have the land just sitting there," said a Dublin source.

The Cherrywood deal was opposed by the developer Mr Liam Carroll, who owns 28.5 per cent of Dunloe, as well as by Mr Phil Monahan, who owns 7 per cent, and Mr Dermot Desmond, who holds approximately 2 per cent. Mr Metliss said he thought the Dunloe shareholders were acting "quite strangely".

The vote on Wednesday was "quite silly. There's no logic to it, it's all personality. No one seems to be taking rational decisions, it all seems to be dominated by personalities and past history."

Since the deal was struck between British Land and Dunloe, the Cherrywood site has been re-zoned as a new town development.

The collapse of the deal following Wednesday's vote means British Land is back in control of the site along with Dunloe.

Dunloe had planned, after buying out British Land, to proceed with an 80,000 square foot development, which would be 20 per cent funded by the company and 80 per cent funded by borrowing.

That will not now happen. Mr Carroll has failed to respond to requests from Dunloe that he explain what his hopes or his intentions are in relation to Dunloe.

One source said it made no sense for Dunloe, a property development company, to have €90 million plus on its balance sheet. Much of the money is from the sale of assets in Belfast.

However, in certain circumstances and with the support of more than 80 per cent of shareholders, the company's own funds can be used to buy out some shareholders.

Mr Smyth, however, has 22.5 per cent of the company and so would have to agree to any such development.

A number of sources said they did not know how the situation would progress. One pointed out that Mr Carroll had been involved in Dunloe for two years now and had yet to explain his intentions.