Shopping centre that lost £20m of its value in decade

Steve Houghton, Leader of Barnsley Council

Steve Houghton, Leader of Barnsley Council

0
Have your say

QUESTIONS have been asked over the £30m taxpayer-funded purchase of a Yorkshire shopping centre nearly 10 years ago after it apparently lost two thirds of its value.

Barnsley Council is close to sealing a deal to buy the town’s Metropolitan Centre for just over £10m, sparking questions over the £30m Yorkshire Forward paid for it from private owners in 2002.

The centre, which forms a key part of the town centre’s market redevelopment to regenerate Barnsley, is being bought from the Homes and Communities Agency (HCA) at market value.

Politicians are already angry the council is having to pay anything for the site, which transferred to the HCA from Yorkshire Forward which is in the process of being wound down, because Sheffield and Leeds are being given control of assets of the former regional development agency in their cities free.

But the purchase price has sparked questions over whether too much was paid for it in the first place as Yorkshire Forward splashed out £30,740,000 for it in September 2002 – three times as much as it is valued now.

The deal comes just weeks after the Yorkshire Post revealed that Yorkshire Forward’s Leeds headquarters could be sold for half the amount originally paid for it.

“Clearly questions need to be asked about the ways in which public sector bodies purchased assets for public use,” said Penistone and Stocksbridge MP Angela Smith. “In this case, questions need to be asked whether or not Yorkshire Forward paid over the odds for the purchase of assets from the private sector.

“Is this a widespread practice or does it occur on a regular basis with the public sector, and if so what can we do to make sure the taxpayer isn’t ripped off?”

The Metropolitan Centre is at the heart of Barnsley’s markets project regeneration scheme, which includes new indoor and outdoor markets, shops, department store, restaurants and cinema in the heart of the town. It is seen as vital to the future economy of the town centre, attracting people into Barnsley rather than going elsewhere to shop and spend time.

Although the project was delayed because of the recession, it is hoped work could start later this year and the project could be complete by 2015.

Barnsley Council will hope to recoup its cash by selling on the site when redevelopment is complete.

Alistair Russell, director of investment at property services company Dunlop Heywood, said commercial property values have dropped by about 50 per cent and the site would have limited interest to other buyers, but also questioned the initial purchase price.

“Did Yorkshire Forward pay too much for it in the first place and got it ahead of the market by paying the most for it?” he said.

“If you said to me that the council would pay £10m for it compared to what Yorkshire Forward maybe overpaid in 2002 it wouldn’t surprise me.”

Barnsley Council leader Steve Houghton said the authority was paying market value for the site and said the price had been driven down by depreciation, shortening leases on units in the centre and a growing backlog of maintenance and repairs.

“The value has diminished since it was purchased by Yorkshire Forward,” he said. “We feel that’s a realistic market price and it has been confirmed by the HCA.”

He said the council would like to take control of other former Yorkshire Forward assets in the town, but it is unlikely the authority will be able to find the money for them so they will remain in the hands of the HCA.

Ms Smith said: “Yorkshire Forward assets in Sheffield have been given to the city council to manage, sell or invest in as they wish.

“But in the case of Barnsley these assets are only available to purchase by the council.

“It seems completely unfair. Why should Barnsley be treated any differently to Sheffield when it comes to control of publicly owned assets?”

A spokesman for the HCA confirmed a deal had been agreed with the council which could be finalised early this year.

He said the price agreed was market value.

Yorkshire Forward declined to comment and referred inquiries to the HCA.

Back to the top of the page