A bid to re-open Manston as an airport has suffered a setback after Thanet council announced it would not be pursuing negotiations with three potential partners in a compulsory buyout.

A report, due to be considered by the council’s cabinet, says that after assessing the three proposals that followed a “soft marketing” exercise, none of them met with its requirements to team up for a Compulsory Purchase Order.

It says that after examining the proposals “one can draw the conclusions that in terms of the key lines of enquiry, the market cannot deliver on the council’s requirements; there is no established market which is able to deliver, or an adequate number of operators; the market has no capacity to deliver the requirements and there is no cost or other benefits in taking this matter further.”

Thanet council: "The market has no capacity to deliver the requirements and there is no cost or other benefits in taking this matter further.”

However, the council says that it did receive other expressions of interest with one unnamed party.

“One party is approaching the current owners to negotiate a purchase and hence did not participate in the soft market testing process. They are backed by sovereign wealth funds - and potentially public sector pension funds - and are considering investing up to £150m, subject to a feasibility study showing that investment in the airport makes economic sense.”

The report concludes: “Two rounds of soft market testing have not produced a suitable indemnity partner in relation to a CPO for Manston Airport. Any additional interest in pursuing a CPO outside the soft market testing process would of course have to pass the same stringent tests.”

The current owners of Manston, which has been renamed Stone Hill Park, want to develop the site as a mixed housing and business park.

Meanwhile, the American investment company RiverOak, which had been in negotiations with the council, is still planning a Development Consent Order with the government to pursue its interest in re-opening Manston as an airport.