Work stops on Penrith New Squares scheme as bank withdraws funding
Last updated 11:16, Wednesday, 08 October 2008
Work on the multi-million pound New Squares development in Penrith has ground to a halt.
Developers Lowther Manelli have confirmed that the £79million scheme, the biggest in Penrith’s history, has been stopped, after the National Bank of Australia withdrew funding for the project.
At a meeting of Penrith Chamber of Trade last night council leaders released the news that everyone in the town feared. Contractors stopped work on the site at around 1.30pm on Monday, due to financial problems in the midst of the credit crunch.
It is not known how the development will now move forward, although councillors say they have a contingency plan, should the collapse be permanent.
Speaking before the meeting, at the North Lakes Hotel in Penrith, Eden Council chief executive Kevin Douglas said: “Work has been stopped, but what the position is we don’t know.
“We will hopefully be getting clarity by the end of the week.
“It has been a concern for about three weeks, and we had our first meeting with the developer for an update three weeks ago.”
The development was to include a major shopping centre on the south end of town, a 55,000sq ft Sainsbury’s supermarket and a new football ground for Penrith FC on the edge of town.
Addressing the town’s traders alongside council leader Colin Nineham, Mr Douglas added: “One of the difficulties was how they could fund these schemes.
“The credit crunch has affected a lot of what happens. But the council, the developers, and Sainsbury’s are all committed to moving the scheme forward.”
One trader at the meeting said the development was: “the worst-case scenario coming true.” Another man said the town had been left with a ‘bomb site’ leaving an unsightly mark in the town. Work has also stopped at the Frenchfield site which was due to become home to Penrith Football Club, less than a month from the site’s completion.
The club are permitted to remain at their current Southend Road ground for the remainder of this football season, though, and are likely to do so until the development is back up and running.
Contractors Bowmer and Kirkland, and Thomas Armstrong, were both unavailable for comment, but it is thought that machinery has been removed from the site.
Sainsbury’s declined to comment.
Lowther Manelli has said it will issue a statement about the development today.
9 proprties have been structurally damaged by this development & we are still awaiting insurers decisions.The perpetrator-a sub contractor-even had the temerity to inform me he was not aware of the damage caused-obviously he does'nt read the 'Publick Prints' as Sam Pepys would have said & in any case had been advised not to comment.
But dont sack the Council - the best punishment is to ensure they sort it out-suspending their allowances until they do!
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They should make the site a free carpark so that shoppers can come and spend in the shops Penrith already has. This would bring in more cash to regenerate the buildings that are already standing empty in the town and attract new businesses.
Posted by Rachel on 10 October 2008 kl. 11:02