The housing crash has hit a major Colchester development plan.

Part of the package for a new research park at Essex University included residential land which would be sold off to a developer for housing.

However, the university has announced that its proposed developer has pulled out of the deal, which has put the whole project at risk.

The project included a new roundabout on the A133 Clingoe Hill, improvements to the Greenstead roundabout, and a contribution towards upgrading Hythe station.

A spokesman for Essex University said: "The University of Essex is disappointed, but not surprised, that the developer of the residential land has decided not to proceed in the current economic climate.

"This is a short-term setback, as the university would still expect to sell the land when the housing market recovers.

"In the meantime, we are exploring ways in which we can take forward components of the overall research park project, particularly the business incubation centre and the student housing."

Speaking at a Wivenhoe Town Council meeting on Monday, Mark Cory (Lib Dem, Wivenhoe Cross) said he feared this would mean no new road crossing.

He said: "I've heard through the university that the research park is faltering.

"There will be less need for the new road junction, but it also means there will be no planned crossing over the junction on Clingoe Hill.

"The plans might be changed for that."

Calls have been made for a new, safer crossing after two students were killed crossing the A133 in 2006 and 2007.