Council-owned Castle Quay development value falls by 40%

A council which bought a shopping centre and leisure complex for £121.6m in 2017 has said its value was now worth 40% less than what it paid.

But Cherwell District Council said the value of Castle Quay in Banbury, Oxfordshire, would not have a “direct financial impact” on the authority.

It said it spent £65.2m buying the centre and £56.4m on a partly-finished new leisure complex next to it.

A councillor said it would be “nigh on impossible” to recover its value.

The Conservative-led council decided to pay for the new leisure complex, now known as Castle Quay Waterfront, after an investor pulled out in 2017.

A Premier Inn hotel and Lidl supermarket have already opened while a cinema, bowling alley and restaurants are being finished.

The authority bought full control of the shopping centre from Aberdeen Standard Investments, which dropped out of the project, in 2017.

Marks & Spencer and Debenhams have closed their stores in the shopping centre since August 2020.

A Cherwell District Council spokesman said the expected value of the shopping centre and new complex is estimated to be £72.5m.

“Market sentiment will always fluctuate, but our commitment to the town centre is a long-term one.

“We are continuing our work to make Castle Quay as vibrant and diverse as possible and supported by the new offerings that are coming forward,” he said.

But a Green councillor, Ian Middleton, said the council’s leadership seems “remarkably relaxed” about its fluctuating value.

He said the authority’s “vanity project…[is] unlikely to provide much benefit to the people of Banbury whilst everyone in Cherwell pays for it through higher council tax and reduced services”.