Norwich City Council buys popular office, shopping blocks to rent back to local businesses

Norwich City Council has bought up to £40m-worth of office and shop blocks, and has spent £13.4m last year on buildings to rent back to businesses in 2017.

Figures uncovered by the Eastern Daily Press highlighted the council’s purchase of a block of shops on London Street housing Laura Ashley and Mountain Warehouse for £9.4m in April, as well as spending £6.8m buying the Lloyds Bank building on Gentleman’s Walk late last year.

Green Party councillor Denise Carlo told the EDP: “Councils are being starved of funds by the government and it is pushing them down these risky routes.

“There is so much uncertainty around, especially for retail with big names going to the wall. It has become a bit of a trend around the country but it really is an unknown risk.”

The EDP also noted that more deals like this are on the way. Norwich City Council’s cabinet meeting tomorrow will approve a potentially large investment, but the details of the investment have yet to be released to the public.

Norwich City Council buying local buildings is a method which many authorities have adopted around the UK: in May, Liverpool City Council announced plans to purchase a shopping centre situated above Liverpool Central train station in an attempt to push forward multimillion-pound regeneration schemes in the city.

One council spokesman told the EDP: “By using cash holdings like this we get a higher rate of return than we can achieve by depositing the cash in banks and building societies, plus we unlock rental income from the properties.

“The council has owned commercial property for decades so this is not anything new for us. As of March 2018 the council own 277 commercial properties. We already therefore have experience of buying, selling, maintaining and managing such properties.”

PSE has reached out to Norwich City Council for comment.

Enjoying PSE? Subscribe here to receive our weekly news updates or click here to receive a copy of the magazine!

Image credit: phountains-photography