The immediate future of a Conservative club headquarters appears to have been secured following the resolution of a three year dispute between party officials and social club members.

Officials from the South Norfolk Conservative Association and the Grasmere Social Club in Diss said they are 'back in business' following a long-running feud over plans to demolish the 1960s building for a flats development.

Plans by grassroots Tories to turn their site in Denmark Street into 14 new homes prompted a petition in opposition signed by more than 1,200 people, but were granted by a district council planning committee in 2009.

But the association this week said they had resolved their differences with the Grasmere Social Club that use the site and had agreed a new lease with the club in principle.

However, Peter Stebbings, chairman of the South Norfolk Conservatives, refused to rule out a future residential development at Grasmere, which is also the constituency offices of South Norfolk MP Richard Bacon.

He added that he hoped the resolution would help bring back party members and users of the building who had left during the dispute.

'Our relationship is back to normal and the way both sides addressed the various issues has been pleasing. The ill-feeling that developed in 2009 and 2010 had left a sour taste, but thankfully the wounds have been healed and both sides can move forward and enjoy the Grasmere environment.'

'I would not say categorically the development has gone away. We still have that option, but certainly it will not be anything that was originally put down,' he said.

Les Rose, chairman of the Grasmere Social Club, added: 'The threat of the club's closure over the past two years has proved to be a very difficult period for everyone involved. Particular problems have been retention of club members, the use of the facilities by other groups and the various financial implications. Hopefully news of this potential settlement will encourage those members and groups who left because of the club's uncertain future to consider rejoining.'

The Grasmere Social Club's lease at the venue expired in 2010 and the matter of a new lease had been set to go before a county court hearing.