But despite news that the Headingley Development Trust has missed out on a grant from the government's Community Assets Fund, members remain confident that they can raise the £1.3 million total needed to make Headingley Enterprise and Arts Trust (HEART) a reality.

* Click here for more Headingley Development Trust news.

Leeds City Council agreed to transfer the Headingley Primary School building to the Trust in November, and it is hoped HEART will be a community centre, arts space, café and enterprise centre housed within a newly eco-friendly conversion of the former Headingley Primary School building.

Spokeswoman for the trust, Lesley Jeffries, said: "We are extremely disappointed by the decision and it does take some of the energy out of the project, but on the other hand it does make us more determined to get it right.

"One of the things we all feel is that we have had this twice in two years, with the Lottery application as well, and both times we haven't received any feedback as to why we haven't received the grants.

"We have three options now: substantially reduce the level of refurbishment, which is a great shame to us because we wanted this to be a beautiful and iconic building; get a bigger loan which means we take
on more of the risk; or try and raise the money ourselves.

"We are hopeful that with the support of our members and local politicians there will be solutions."

The Trust has so far raised £200,000 from a grant and £300,000 from a loan, as well as £51,000 from share issues.

They are looking to raise another £50,000 from the share issues process.

The £30 million Community Assets Fund offers grants for the refurbishment of underused local authority buildings to get them up to scratch for transfer to community or voluntary sector organisations.

The cash is being administered by the Big Lottery.

This is not the first setback to the HEART project which also missed out on a massive Lottery grant last year that jeapordised its future.

Headingley councillor James Monaghan (Lib Dem) said: "I am disappointed the Trust has been unsuccessful in its bid, especially as I believe they have such a strong case for funding.

"Ward members will do all they can to continue to support the Trust in its proposals for Headingley Primary
School."

Headingley Development Trust has also led a local shop into community ownership,
run a monthly deli market and is working with a local estate agent to encourage families back into the area, alongside other initiatives.

A share issue has so far raised over £50,000 for the HEART project.

* If you would like to buy shares or become a member of Headingley Development Trust visit: www.headingleydevelopmenttrust.org.uk