Attempt to halt £15m loan for new Hilton hotel is defeated

Opposition city councillors failed to halt the £15 million loan for the building of the new Hilton hotel at Fletton Quays. Cllrs Aasiyah Joseph (Labour) and Nick Sandford (Liberal Democrat) called-in the loan to Propiteer Hotels Ltd (asked for the decision to be reconsidered) on the grounds that it was not in the public interest to risk taxpayers’ money in this way.

But Cllr David Seaton, cabinet member for resources, said: “We asked Deloitte to gather due diligence on Propiteer Hotels Ltd, a company specifically set up to build this hotel for Hilton, and both parties have complete confidence in them.” Under the terms of the deal the council will borrow money at a “very competitive” interest rate before lending it to Propiteer which would pay a higher rate of interest back to the council at the end of the two year period. This would make the council a profit. Cllr Seaton added: “Yes there is a risk, but we feel it is justified, and we could make £500,000 profit on our loan.” Cllr Dave King was not convinced. He said: “If they’re such a huge company, why do they need a £15 million loan from us?” Cllr Sandford said: “We don’t have a great deal of information on these people, and what we do know worries me. “Yes, it is important that the council gets extra money from investments, but it should be done in a cautious way, so that taxpayers’ money is invested prudently.” Councillors voted by a majority not to call in the loan.