WNC offers £2 million loan to shopping centre owners to keep H&M in Northampton town centre as part of huge deal
West Northamptonshire Council has offered a £2 million loan to a multi-millionaire property giant to keep H&M in Northampton town centre.
West Northamptonshire Council has offered a £2 million loan to help a Grosvenor Shopping Centre owners, Evolve Estates, to keep H&M in the town.
In a report recommended for approval at next week’s cabinet meeting, WNC has revealed major plans for Belgrave House and the Grosvenor Centre in Northampton.
The report includes the following proposals:
Financial support for new tenants
WNC is offering financial incentives for businesses to invest in the Grosvenor Centre, including a £2 million loan to assist H&M’s relocation to the shopping centre from Abington Street. The loan is low-risk, backed by guarantees from Evolve’s parent company, according to WNC.
A WNC spokesman said: “Evolve for its part has aspirations, in particular to bring H&M into the Shopping Centre, with the alternative likely being H&M leaves Northampton entirely."
Additionally, a loan of up to £1 million is earmarked for flexible office space development by Wizu, and £375,000 is proposed for the creation of "micro shops" in vacant spaces, with the council sharing net income from these units.
A WNC spokesman said: “This would provide for WNC to make a £375k capital contribution to the fit-out of the micro shops. Provisions are included to allow WNC to make payment directly to NGPL’s (Evolve’s) contractors, so as to help ensure the money ends up where it is supposed to go."
According to Evolve Estate’s website, it is part of M Core, a privately funded property collective with a combined asset value of over £5.3 billion.
Changes to Belgrave House use
Currently limited to residential accommodation for key workers, the vacant Belgrave House will have its restrictions lifted to allow broader usage such as office or retail space, with necessary repairs, including roof work. WNC explained why social housing is no longer feasible, citing fire safety requirements as the main factor.
A WNC spokesman said: “The leasehold estate in Belgrave House transferred to WNC on April 1, 2021. Northampton Partnership Homes then proceeded with the early stage of works to convert it into flats, including stripping out all internal fittings, including the lifts. However, as is reported elsewhere, it has become apparent that the social housing scheme proposed is not viable. Indeed, assessments indicate no residential use is likely to be viable, partly because of the enhanced requirements for fire protection now in force for taller buildings."
Renewable energy and car park proposals
WNC is also proposing the installation of renewable energy systems at the Grosvenor Centre’s multi-storey car park, including solar panels and electric vehicle charging points. The council aims to resolve any potential disputes with the current leaseholder, Evolve.
A WNC spokesman said: “The council wants to avoid any potential for dispute about its right to install renewable energy equipment on the car park.”
Parking Arrangements for Leisure Facility
WNC is negotiating with Evolve to secure up to 180 free parking spaces for a new leisure facility, likely a gym, in the former Sainsbury’s unit in the Grosvenor Centre. The report notes that the “theoretical loss of parking income is expected to be minimal” due to low current usage.
WNC comment
A WNC spokesman said: “It is considered the suite of agreements are the best deal the council is likely to be able to achieve. Taking no action would appear to be counter-productive, and the only other real option, of using compulsory purchase powers has its own costs, timescales, and risks.
“The main risk in the proposals is the loss, in whole or part, of the up to £3 million to be loaned to Evolve. Whilst a reasonably low risk, in that the legal entity to which the money would be loaned holds the Grosvenor Centre lease, and thus it is unlikely to be allowed to fail, the position would be further reinforced with a parent company guarantee from a suitable group company. The loans would not be entered into until further due diligence is carried out and adequate security for our investment is obtained.
“Overall, the proposed agreements are considered to be necessary to enable the Council to make beneficial use of Belgrave House, with the added benefit of removing any dispute over its ability to install renewable energy equipment in the car park.”
Evolve Estates and the Labour opposition have both been contacted for comment.