EXCLUSIVE by Thom Kennedy

Last updated at 16:44, Friday, 29 January 2010

Nearly £400,000 of public money has so far been spent on the collapsed New Squares scheme in Penrith.

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Since the launch of the town centre redevelopment scheme, Eden council has spent £384,100, but has yet to see any return on its investment.

Council bosses claim that the money would already have been recouped in rents and business rates had the scheme been completed as planned, but instead the council is expecting a year of spiralling costs as the future of the Southend Road development is thrashed out.

The costs so far include:

• £218,000 on consultants and advisers working outside council areas of specialist knowledge;

• £152,500 for legal advice, including preparing agreements on the land, leases, and the cost of legal action against the original developer Lowther Manelli;

• £13,600 in miscellaneous costs, such as advertising, public notices and the public consultation into plans by Sainsbury’s to complete the scheme which were abandoned late last year.

On top of that, the council is set to lose millions making the site safe and re-tendering the scheme.

Eden chief executive Kevin Douglas said: “If the Penrith New Squares development had not been affected by the global recession the costs incurred by the council would have been repaid by the first year’s rental income.

“We are determined to overcome these current difficult circumstances,” he added.

First published at 14:11, Friday, 29 January 2010
Published by http://www.cumberlandnews.co.uk