Newark and Sherwood District Council's Labour group raise concerns over council's investment into the Robin Hood Hotel project
Newark and Sherwood District Council's Labour group has spoken out against today's announcement that the council is to invest millions of pounds into Newark's Robin Hood Hotel project.
The council is to put £3.3m into the scheme in a joint venture with M F Strawson Ltd to convert the building into a hotel and retail units. It will get two-thirds of its investment back when the Travelodge element is sold to investors.
The leader of the council's Labour group, Mr Paul Peacock has raised concerns over the investment.
He said: "Last year the council's policy and finance committee was presented with a report that indicated that Strawsons had provided a range of proposals to work with the council which would solve the problem of financing the building of a hotel.
"It is my opinion that those proposals were not properly investigated by the council, instead it put forward the proposals that have been made public today.
"The proposal today, for the council to invest £3.3m in the project, in my opinion, exposes the council to a greater financial risk than any of the proposals originally brought to the council by Strawsons.
"The council are committing £3.3m to the project in its build stage.
"There is a commitment that £2.3m will be returned to the council when the hotel is sold.
"Therefore, the council will spend at least £1m of council tax payers money without any return.
"The council will have an option to purchase the three retail units at a further cost of £900,000 as part of the proposals.
"If this option is taken, the bottom line will be that the council has spent £1.9m on three retail units.
"I think that this represents a massive risk when I see so many empty retail units already in the town. I certainly don’t think this is good value for money for our council tax payers."