UP TO £57 million of taxpayers' money could be gambled to ensure Chester’s highly-anticipated Northgate retail and leisure complex becomes a reality.
A report to Cheshire West and Chester Council’s (CWaC) cabinet reveals no third-party investor has yet come forward to fund the scheme through its construction phase.
But bosses remain confident a private financier will be found and in the meantime have proposed the authority sets aside cash to finance the project “to completion”.
So far CWaC has stumped up £21.65m in design costs and preparatory work and £22m on acquiring the Forum offices, which sit on the proposed Northgate site.
At a meeting on Wednesday, cabinet members will also be asked to free up a further £13.2m to cover the “final site assembly budget”.
The report, written by deputy chief executive Charlie Seward and Mark Wynn, director of corporate services, states: “The maximum total abortive cost could therefore be £56.85m.
“In reality this is highly unlikely as there would be a land/asset value associated with the Forum purchase and site assembly expenditure.”
The pair warn any loss of momentum by delaying or even halting delivery of the scheme would make its future uncertain once again.
The Northgate development is expected to be worth £300m – far more than the development costs and therefore making it a significant investment for the council.
Major anchors for the project have already been secured in the shape of a House of Fraser department store, a Picturehouse six-screen cinema and a new-build Crowne Plaza Hotel.
Outlining the importance of the project – which has been decades in the making – Mr Seward and Mr Wynn wrote: “Research and data gathering over the last 10 years demonstrates that ‘doing nothing’ is not an option that can be recommended for Northgate.
“Action needs to be taken quickly to ensure Chester retains its position as a regional retail and visitor destination and a key economic contributor in the North- West.
“The Chester Northgate scheme will create a significant new destination within the heart of the city extending the prime retail area from Foregate Street and Eastgate Street, and complementing other key One City Plan investments such as the Central Business Quarter, Storyhouse and the new bus interchange.”
With the compulsory purchase order (CPO) process “progressing well” to ensure the site is ready for the construction phase, they say the scheme now has a “real prospect of delivery”.
However, they acknowledge that providing funding through the construction phase of the development carries “substantial risks” to the council.
The first phase of construction is due to start next year, opening at the end of 2019.
Phase two begins later in 2018 with the whole development opening late 2020 or early 2021.
Once complete, the scheme will also boast a new indoor market, restaurant hub in the former library and 120 new homes.
See full story in the Chester Leader