Medway Council buys shopping centre for £35m

Pentagon shopping centre. Photo credit – Danny Robinson

Medway Council has bought the Pentagon shopping centre in Chatham for £34.7m.

The council gave the green light for the purchase back in February and they say the purchase will generate an annual income of £1m which can be ploughed back to support council finances and services for local residents.

They also say they wanted to play a bigger role in the regeneration of Chatham.

Perry Holmes, Chief Legal Officer at Medway Council, said: ‘This is an exciting time for Medway with lots of investment projects underway to help improve the area for our residents.

‘The acquisition of the Pentagon Centre complements the improvement works which have already taken place in Chatham town centre as part of Medway’s monumental 20-year regeneration programme.

‘Medway is an innovative council and we are continuing to demonstrate that we are committed to shaping the future of our town centres to further boost the local economy and provide more opportunities for our residents. Medway is already a fantastic place to live, work, learn and visit, and the area’s regeneration programme will further improve this.’

In related news, the council recently invested £4m, secured from the government’s Local Growth Fund through the South East LEP, to carry out major improvement works in Chatham town centre.

Several local authorities have bought shopping centres recently as a means of generating income for the council or kick-starting regeneration projects.

But some have questioned whether they are worth the financial risk, given all the issues being faced by high street retailers.

In January, North Somerset Council defended its decision to buy a shopping centre after retail giant Marks and Spencer announced its local store is earmarked for closure.

And in June last year, Bolton Council bought the Crompton Place shopping centre for £14.8m to help kickstart its town centre regeneration masterplan.

Read the NewStart Feature on whether councils gambling on their future buying shopping centres here.