Plans for a £130m national centre for film and television on the South Bank in London have been abandoned by the British Film Institute, in a decision partly blamed on the uncertain political and economic climate as Brexit looms.

A huge disappointment and setback for the BFI, the decision was taken shortly before Christmas and was confirmed on Tuesday.

The institute said a deadline to complete the planning process could not be met. “Due to the project’s ambitious scale and complexity, a turbulent economic climate and shifting political environment, meeting this deadline was not possible,” a spokesperson said. Brexit is a major factor in that turbulent environment.

The BFI plans to spend an as yet unspecified amount of money on a major refurbishment of its current 1950s-built home, a building it has been desperate to vacate for decades.

The news, first reported by the Architects Journal, effectively ends 10 years of exhaustive planning for a new film centre on the site of the Hungerford Bridge car park.

It was originally backed by Gordon Brown’s Labour government after he personally stepped in to commit £45m towards a £166m cost. But it was scuppered by the incoming coalition government in 2010, which withdrew support.

Due to leases on the land, the second £130m scheme, with private backers, required that the planning process be completed by the end of 2019.

“The BFI has taken the decision to withdraw its current development plans for a Film Centre on the Hungerford Car Park site at South Bank, London,” the institute said in a statement.

“The BFI is steadfastly committed to the culture of film and the future of the moving image, and we remain focused on the urgent and much-needed investment in our current home, BFI Southbank, planning to start in early 2018 with a major refurbishment project of BFI Southbank’s Riverfront.

“We also continue to explore additional places where audiences, film-makers, artists and storytellers can learn and experiment with this dynamic art form and where creativity, technology and innovation can flourish.”

News of the second scheme first emerged in the spring of 2016 when the BFI said it had received an “unsolicited” offer of £87m towards the £130m cost.

The offer was from the Bangkok-based property and hospitality company Pace Development Corp, which would have got in return full naming rights for the building. It would also have had exclusive rights on food and drink sales.

The German architect Ole Scheeren, a former right-hand man of Rem Koolhaas, was lined up to design it.

Scheeren has been responsible for some of the most recognisable new buildings in Asia, including the China Central Television headquarters in Beijing and the Interlace residential development in Singapore, named world building of the year in 2015. The national centre for film and television, a planned collaboration with the UK architects Haworth Tompkins, would have been his first building in the UK.

The BFI had hoped to open the building in 2022, promising visitors “new experiences in film while providing a hub for filmmakers, artists and industry professionals to meet, exchange ideas, showcase their work and develop skills”.

Its chief executive, Amanda Nevill, had said the new centre was needed more than ever – “a building that will express our optimism, our confidence and our excitement about Britain’s leading role in the future of film, television and the moving image at home and internationally”.

The excitement about a new centre was echoed by leading British actors. Tom Hiddleston called it “the most exciting cultural development to happen in the UK for some time … All the major art forms in Britain quite correctly have national homes except one: film.”

Dame Helen Mirren called it “very exciting”, and said the project would “bring young people and their energies and understanding of the modern world into this amazing form of culture and of self-expression: cinema”.

The BFI is expected to announce details of its 2018 riverfront refurbishment in the next few weeks.