The development company behind a huge coastal tower block of 91 luxury flats has not gone bust, bosses have confirmed.

Developers of the Leas Pavilion in Folkestone say rumours the scheme will not be completed “are completely untrue” and confirm construction is “due to recommence”.

Work has been on hold at the former town centre landmark while a new sprinkler tank was recently installed in the basement of the building.

With residents becoming concerned over the lack of progress, rumours have swirled around the town over the future of the project.

But developers for the site, Gustavia, say any claims are untrue.

“We have been made aware and were very surprised by rumours that work on Leas Pavilion has stopped and the project will not continue,” a spokesman said.

“We can categorically state that this is untrue.

“Work has been progressing at a slower pace because of the requirement to install a sprinkler tank below ground before the reinstatement of the Pavilion structural frame.

“The design and construction of this has now been completed and full construction work is therefore due to recommence.”

Eventually, the site will be home to plush sea-view apartments looming over The Leas – ranging in price from £325,000 for the smallest one-bedroom flats to £3 million for the significantly larger penthouses.

The developers added: “The crane is being inspected today (April 23) and we anticipate it will be in full activity within a week.

“A re-mobilisation programme has been agreed with the contractor that will see the structural frame completed.”

Groundworks and the erection of two towering stair cores have been completed for the project on the cliff-top promenade.

The long-anticipated development has been sold as the best hope for preserving the Grade II-listed building, which was originally built in 1902 as an Edwardian tea room and was later home to the popular Leas Club nightspot.

The Friends of the Leas Pavilion campaign group has also dispelled the rumours as “completely untrue”.

A spokesperson for the group added: “The contractor is servicing the tower crane today as we speak.

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“They are preparing to increase the resources with a target to rebuild the Pavilion structural frame by the end of June so we can continue building upwards from July 1.”

Items of equipment were removed from the site in October as they are no longer required following the completion of the groundworks.

Over the decades, the Leas Pavilion was also home to repertory theatre, with its last-ever performance taking place in August 1985.

It then became the Leas Club, a bar with pool and snooker tables, and even a small ten-pin bowling alley.