Over the last year I have written about the Council’s risky property purchases around the borough in order to create revenue to fund the spending decisions it has chosen to pursue. The schemes they have embarked on range from the unwise to the reckless but one of the latest I think is their most bizarre yet. Hastings Borough Council are going to borrow millions of pounds over a 50 year period to build a supermarket for an international chain, yes you read that right, they are going to build a supermarket for a well-known high-street retailer. The plan is to rent out the space to the retailer but this will not cover the cost of borrowing to develop the site.
The site is well known on the Bexhill Road which has been vacant since a car dealership moved out a while ago. The scheme also involves building two much smaller retail units on the site and only if all the units are full does the Council begin to make any money back to cover more than the loan repayments and pull in a small surplus. The yield from the “investment” will be under 1% a year.
There are several questions which spring to mind about the plans. Firstly, if the site was really that desirable for a supermarket then why doesn’t the huge multinational company build it themselves? Secondly, what happens to the site if the retailer decides to move on when their break clause comes up? The council would then be left with an empty property that would be hard to fill again, whilst of course still paying off the large loan taken out to pay for the now unused building.
This is yet another example of the kind of risk filled enterprise that Hastings Council seems to engage in with seemingly little concern of what the long-term implications could be. All of the properties bought so far are with borrowed money to be paid back over decades, long after sitting councillors and senior employees have left the organisation. So many loans have now been taken out that the annual bill for the interest on them is over £750,000 which, as a taxpayer, you are paying for.
The amount that the Labour administration at Hastings Borough Council intend to borrow on your behalf at this stage is £40,000,000, that is well over £1000 for every household in the town.