A LYME REGIS hotel that has stood empty for 13 years looks set to stay shut for years to come as coastal defence work in the town continues.

The Three Cups Hotel on Broad Street is owned by brewers JC and RH Palmer and managed by Humberts commercial in Yeovil.

Humberts commercial said this week that the Three Cups was not for sale and that nothing could be done with the building until the issue of ground stability in the town was resolved.

Nigel Jones of Humberts Commercial said: "We are looking at all the alternatives for the Three Cups but we can't do anything until we know the situation in terms of ground stability."

Mr Jones said he wanted to put the record straight as Humberts had received a number of calls from people interested in buying the property.

He added that the coastal development schemes currently underway in Lyme Regis would directly affect the town centre hotel, which closed in 1990.

Phase two of the scheme, due to start in 2004, will see major engineering works stretch from behind Broad Street across Langmoor and Lister gardens over to the Cobb side of the town.

A West Dorset District Council spokesman said the council had never told Palmer's that they couldn't redevelop the site, although any proposal would need to take in to account the condition of land in the area.

He said: "In recent years West Dorset District Council have held various discussions with the owners and agents of the Three Cups Hotel.

"The land behind the hotel falls into the area that is due for stabilisation as part of the council's £15 million engineering works that are scheduled to get underway early in 2004.

"The scheme aims to protect the foreshore from attack by the sea and stabilise land in the town. This promises to offer some long term protection for local property and businesses in the area against the threat of landslides and coastal erosion."

The Three Cups was once an important part of Lyme's town centre and was used for a bedroom scene in the film The French Lieutenant's Woman.

Palmer's smartened up the front of the building in April last year after its decaying exterior had become an eyesore. A spokesman for Palmer's said Humberts Commercial was responsible for all the company's property and declined to comment further.