Council Decides to Increase Borrowing and Take the Next Step
West Devon Borough Council have been looking at commercial property that they could buy to enable them to generate a profit as part of the commercial property acquisition strategy which they approved earlier in the year.
In July the Council agreed to borrow up to £25m out of a possible £75m as part of the first phase of borrowing to acquire property to generate income streams.
At a meeting of Full Council this month, West Devon Borough Council agreed to increase the size of their initial investment by £10m, plus the associated acquisition costs might need more flexibility as they search for suitable properties.
Cllr Philip Sanders, Leader of West Devon Borough Council said:” So far we have not made any purchases but we have considered a number of opportunities. What has become clear to us is that in order to secure property we need a little more flexibility to enable us to get the right deal for us. This agreement today gives us the flexibility we need to kick-start this project.”
The property acquisition strategy was discussed by West Devon Borough Council earlier this year before a decision was made on the proposal to create a new Council. The decision not to create a new Council does not change the property strategy in principal but it does make the need for West Devon Borough Council to generate income streams more urgent.
The property strategy will see the Council borrowing money to purchase commercial property with established tenants in place. Once all costs are taken off, this strategy could deliver a £0.45m surplus which would be used to fund services within the Borough.