£2m goes on aecc bailoutand £3m on arts centre
City battles for bigger payout on land deal
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Aberdeen City Council is battling for a larger share of a controversial property deal worth tens of millions of pounds, it emerged last night.
And councillors yesterday approved a £2million bail-out of the city’s debt-ridden exhibition centre – and agreed a £3million grant which will allow Peacock Visual Art’s ambitious new Union Terrace Gardens centre to go ahead.
The resources management committee put on hold a decision over a £50million property deal which would see about 400 homes built in the city’s west end.
Instead of pulling the plug, officials were told to go back to the negotiating table to try to maximise the authority’s slice of the proceeds from any future transaction.
The Press and Journal last week revealed the potential sale of the Pinewood and Hazledene sites was close to collapse after independent consultants said the prime development land could be worth more after the current economic slump passed.
Councillors yesterday decided a previous agreement that would see the authority gain only 50% of the value of the Hazledene site, and 30% of the Pinewood site, may not be best value for taxpayers.
The council’s share had been based on the fact both sites are leased to Ben Reid Nurseries – co-applicant for plans to build 400 homes with developer Carlton Rock – until 2020.
It is understood the release of the land could still collapse, however, if a suitable compromise is not reached.
Opposition Labour group spokesman Willie Young said: “It would appear, subject to proper negotiations, we are going to get houses on these sites.
“It is important the council gets best value for the sites, but it’s also important we move ahead quickly.”
Meanwhile, Peacock Visual Arts was celebrating last night after committee members ended an anxious wait over the fate of its £13million contemporary centre planned for the city centre.
Peacock director Lindsay Gordon said: “We are totally delighted – it’s great news for Peacock and great news for Aberdeen.
“We have been tremendously encouraged by the support we received from all sectors in Aberdeen, and it’s fantastic the council itself had the vision and courage to invest in the future.”
But strict conditions were imposed on the funding.
Peacock must find an organisation to underwrite its £4.5million share of the cost, and there will be no bridge- funding from the council.
Councillors on the committee voted overwhelmingly to award the capital grant.
Convener Kevin Stewart said: “The council has fulfilled its commitment to give £3million of capital. However, that money is capped.”
Councillor Bill Cormie welcomed the decision. He said: “As a staunch supporter of this project, I think it will benefit the gardens and the city and I sincerely hope Peacock finds the money they need to make it a reality.”
The committee also backed the £2million bailout of Aberdeen Exhibition and Conference Centre (AECC), after officials said there was “no option” if the council-owned centre was to continue.
The AECC is thought to be in around £16million of debt, despite annual funding of £650,000 from the council, but is also estimated to bring about £40million a year into the local economy.
Its directors hope a hotel development planned for the site will secure its viability.
Chairman of the AECC board, Councillor Neil Fletcher, said: “I’m pleased that the council has reaffirmed its support for the AECC, which provides significant economic benefit to the city.”
But Labour’s Willie Young said: “We are disappointed that the AECC is in such a financial mess.
“We have agreed to give the £2million they asked for because if we don’t we were told by officials that the AECC would be in a position where it was trading illegally.
“This is no way to run a business and it’s no way to run a council.”
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