Nokia is to pull out of its flagship Regent Street store on the back of disappointing sales after just two years.

It is a rare setback for the street, which has attracted a raft of new retailers as its owner the Crown Estate has sought to revitalise it.

The move is a blow to the regeneration but it paves the way for new names. It is understood that fashion chains Victoria’s Secret and All Saints are keen to take Nokia’s 7,490 sq ft shop. Both retailers have been eyeing the street for some time.

Nokia, which has seven other stores including a flagship at Heathrow’s Terminal 5, said it will close the store in the first quarter of 2010.

In a statement the phone retailer said: “Nokia is crystallising its branded retail strategy, aiming at improving operational efficiency of its retail network. This requires revamping of the retail network.”

Nokia said it has no plans for another London store at the moment, and the Regent Street format is “unlikely to be replicated”.

A spokeswoman said: “The Regent Street store has not been as efficient or as profitable as we’d have liked it to have been.”

She added that the decision has “not been taken lightly” but Nokia’s changing business model meant its stores had to bring the brand’s services “to life”. “The store at Regent Street didn’t allow this”, she said.

30 employees are now in consultation and other roles are being sought for them within the company.

The spokeswoman said Nokia’s other UK stores are performing well.

David Shaw, head of Regent Street portfolio at The Crown Estate, which acts as the landlord for stores on the street, would not comment on any retailers interested in the store, but said: “We’d be delighted to see retailers like All Saints or Victoria’s Secret on the street.”