Council invests millions of taxpayers’ cash in property
TOWN HALL HOPES TO GAIN GREATER RETURNS
A COUNCIL spent £203.4million on purchasing and investing in property last year as part of its finance strategy.
Trafford town hall spent the cash in the hope of bringing in greater returns for council tax payers through interest on loans and from profits on any future sales of property assets, as well as supporting ongoing regeneration across the borough.
Some of the money used to make these investments has come from a central government borrowing fund which offers low interest rates for local authorities and encourages them to invest in property.
The rest has come from within the town hall’s budget using council tax.
In total, Trafford has purchased five properties this year for a total of £75.8m and made loans as part of its property investment strategy totalling £127.6m.
The council bought the following properties in 2019:
Lacey Street Royal Mail depot, Stretford (bought for £800,000)
Stretford Mall (bought as part of £100m deal with developers
Bruntwood: £50m to cover the council’s half of the purchase, a further £50m was loaned to Bruntwood to cover their half of the costs)
Stamford Quarter Shopping Centre, Altrincham (bought as part of above £100m in Bruntwood deal)
Clarendon House (bought as part of above £100m Bruntwood deal)
Sainsbury’s Altrincham (bought for £25m)
The council loaned money to owners or developers for the following properties:
CIS Tower, Miller Street, Manchester city centre (loan of £60m to owners for refinancing and refurbishing the building)
Four office buildings off Albert Square, Manchester city centre (loan of £17.6m as property investment)
Stamford Quarter, Altrincham (£50m loaned to Bruntwood developers as part of £100m purchase deal)
Stretford Mall (£50m loaned to Bruntwood developers as part of above deal)
Clarendon House ( £50m loaned to Bruntwood developers as part of above deal)
The grand total of more than £203m spent this year doesn’t include a further £2.5m loaned to Trafford Leisure to support two leisure centres in Altrincham and Urmston.
The council made clear that the loan wasn’t part of the council’s investment strategy, but to support the centres and give staff their first pay increase in years.
Other ongoing development projects that the council has on its books include the former Kellogg’s factory site in Stretford that was bought for £12m back in September 2017.
The site is expected to include 750 homes, an 100-bedroom hotel and a primary school once development work is finished.
Plans to merge two primary schools, knock down their 100-year-old building and replace it with a brand new 21-classroom school in Altrincham are also on the cards. The council is still in talks with Stamford Park Infants and Junior Schools after an offer of £8m to build a new school on the site was turned down twice.
A town hall spokesman said: “Trafford council purchased or invested in a number of properties in 2019 as part of our ongoing investment strategy. This strategy supports our regeneration priorities, such as Stretford Mall, and provides an income stream which funds critical Trafford council services.”