THE owner of the second biggest London residence after Buckingham Palace will invest £1m in one of the North-East's most deprived estates.

Admiral Estates, which is believed to have links with the rulers of Syria, will begin work this week on redeveloping a run-down shopping arcade at Scargill Court, on the Lascelles estate, Darlington.

The London company also owns the BBC Fame Academy - the Witanhurst Manor mansion in Hampstead Heath - up for sale at £42m with a Rolls-Royce thrown in.

Its plans for Darlington include a supermarket, small shops and three flats in the semi-derelict building.

It is hoped the work will be completed within five months.

But in an 11th hour move, Darlington Borough Council attempted unsuccessfully to purchase the lease on the building, with a view to developing it as housing.

The move jeopardised the involvement of Admiral Estates, but company director Shah Hussain told The Northern Echo that he was determined to see the project through.

He said: "We see Darlington as a town with great history, and great potential. Why should it not be competing with Newcastle and Sunderland?

"This project will firstly benefit the people of Lascelles, but also the town as a whole."

A council spokeswoman said it was acting to hurry the project along.

She said: "Since Mr Hussain purchased the lease for Scargill Court in July 2004, the council has grown increasingly concerned that because no work has been carried out, the empty shops have deteriorated in condition and are attracting anti-social behaviour."

"In 2005, Mr Hussain's agent told us he would be proceeding with the development and was seeking tenants for the shops.

"In February this year, as work had still not started, it was felt that the council ought to try to take control of the site to prevent it becoming more rundown and to address the issues of anti- social behaviour."

The building has fallen into disrepair in recent years. When Admiral Estates began to tidy the building up, they found it had been used as a drugs den.

Mr Hussain said: "We found syringes full of blood and some of the contractors walked out. But we've cleaned it out, and the plans for it are very exciting."