District council buys industrial unit for £6.1m

West Lindsey District Council in Lincolnshire has purchased an industrial unit for £6.1m.

The council say they purchased the building to generate income following budget cuts.

‘We cannot sit back and take the cuts to our budget without doing everything we can to bring in extra money to help maintain and improve the services that matter most to local people,’ said leader of the council, Jeff Summers.

It is the fourth purchase to date for the council, with Cllr Summers confirming there will be more property purchases in the coming months to ‘support local services.’

Since the launch of their investment strategy in April 2017, property investments have included a hotel in Keighley for £2.35m, and two properties in Sheffield for £2.5m and £3m, respectively.

According to the BBC’S Local Democracy reporting service, these purchases brought in an annual income of more than £500,000.

Grant funding to West Lindsey District Council has reduced by £4m since 2012 and Cllr Summers defended the purchases to residents, saying all income will be spent on ‘economic regeneration and growth of our district.’

‘We’re trying to generate the best possible return for our residents and will, therefore, consider investing in opportunities wherever they arise,’ he said

‘The council has sound financial and legal knowledge and great care is made on each of the investments which must follow tough guidelines before any purchase is made.’

Ian Knowles, executive director of West Lindsey District Council, explained councils have to do things differently in order to deliver services for local people.

He said: ‘We are not alone in our approach to investment opportunities. Our investment strategy was approved by the council’s Corporate Policy and Resources Committee in April 2017,’ he said.

‘We follow a stringent set of guiding principles under which the council will invest. As part of the acquisition process, the council follows a 14 point scoring criteria that ensures it considers all issues, i.e. the condition of the property, tenant financial standings, yield return and proximity to the district.

‘For clarity, the council receives a market rental for the properties and it is in no way involved in the individual businesses operating from the properties.’