Cheshire West & Chester Council and Weaver Valley Partnership have abandoned a development agreement with Wilson Bowden Developments for the Baron's Quay town centre scheme.
Vale Royal Council selected Wilson Bowden as preferred developer in 2005 for the £200m development which included 300,000 sq ft of shops, residential, leisure, hotel, offices, revamping of the river frontage and a new arts and cultural centre.
The Weaver Valley Partnership said the decision to end an agreement with the developer was due to the prevailing market conditions impacting on the viability of Wilson Bowden bringing forward the regeneration scheme as envisaged by the agreement.
Weaver Valley added that the agreement it has with the council will enable the development of a new retail and leisure scheme on a 40-acre site.
Outline plans and artists' impressions are expected to go on display as part of an engagement exercise with the community this summer, with planning applications submitted by the end of the year.
Weaver Valley said Baron's Quay will act as a catalyst for other major investments crucial to the regeneration of Northwich.
Other schemes now expected to come forward include an £11m cultural and leisure centre and a redevelopment of the waterfront between the two town bridges.
Weaver Valley said the redevelopment of Baron's Quay will dramatically open up riverfront area and create a vibrant quarter for people.
The organisation added that building on designs and consultation undertaken last year, including strong links with Witton Street, Weaver Square the market will be at the heart of its design, to ensure the development complements the existing retail area by encouraging a natural flow of pedestrian traffic between the two areas.
Elsewhere, work is underway to identify a preferred site for a cultural and leisure centre.
The views of local residents on the site and design of the centre will be sought in the coming months, with a view to the centre opening in 2013.
Other major plans for the town centre include a scheme led by British Waterways to redevelop the waterfront between the two bridges.
Meanwhile, plans are progressing on major housing developments at Winnington and Wincham urban villages.
A new road design aimed at improving traffic flows around Watling Street, Chester Way and the two swing bridges is currently being developed.
A community engagement exercise on the proposals will be held in the summer with a view to it being installed on a trial basis.
Geoff Hope-Terry, chairman of the Weaver Valley Partnership, said: "We're at the start of a very exciting time. It's not going to happen overnight and there's a lot of work to do, but I'm confident we have the right approach and the right ideas.
"It's a great demonstration of a successful partnership between us and Cheshire West & Chester Council."
Wilson Bowden was not available for comment when contacted by Place.