Eastbourne Borough Council has been criticised over its financial management after it emerged the Hampden Park retail park is now worth 10 per cent less than the authority paid for it.
The town’s Conservative Group say the Lid Dem-controlled council is ‘saddling Eastbourne taxpayers with debt’ after an audit report seen by councillors is said to claim the park has decreased in value by £2.119 million.
This comes after it was bought by the council in May 2017 for £18.8 million.
A spokesperson for the Conservative group said, “The Lib Dems are already saddling Eastbourne taxpayers with £194.8m of debt by 2019/20 across several projects, such Devonshire Park, where costs continue to spiral.”
Councillor Penny di Cara (Conservative, Sovereign Harbour) said, “This is yet another example of the Liberal Democrat administration’s inept and reckless investment strategy and questions need to be asked as to why this purchase was made when it’s not worth what the council paid for it in just over a year.
“Many local people when presented with these figures will conclude that this appears to be an extremely risky investment given the current situation in the retail environment with many high-profile business failures like BHS and House of Fraser over the last few years.
“Time and time again, we see this council overstretching itself, over spending on projects and forever taking on extra liabilities. It’s time they explained to local people what on earth is going on.”
But Councillor David Tutt (Lib Dem, St Anthony’s), leader of Eastbourne Borough Council, defended the investment as generating ‘vital income’ for frontline services in the midst of Government cuts.
He said, “The council’s long-term investment in Hampden Retail Park has provided a welcome boost to an important and very popular out-of-town shopping location and is generating vital income that will maintain frontline council services.
“The government cuts in funding for local public services has meant councils across the UK are investing in profitable commercial developments.
“The rental income per annum based on the existing tenants and the leases agreed by the council to date will be £1.2million; when we purchased the property the income was £1million.
“The investment has received broad support from the business community, including Eastbourne and District Chamber of Commerce, and the new retailers that have decided to also invest in the site.”
He said Costa will be opening a drive-thru at the park and other businesses include carpet specialists Tapi and Office Outlet, formerly Staples, has already relocated to the retail park.
“With planning approval in place our refurbishment plans will see existing buildings updated and additional units built, and with the arrival of new stores around 30 new jobs created,” Councillor Tutt continued.
“Fluctuations in capital values are inevitable, but what is most important is the return on investments. Most recently, the council received £9 million following the sale of Welbeing.
“Under the council’s stewardship and investment Welbeing has become one of the UK’s leaders in the telecare sector, helping thousands of people to live independently.”