Council agrees sale of pigeon-infested hotel

The sale of an unfinished, pigeon-infested Hilton hotel has been agreed, Peterborough City Council has said.

The authority lent £15m to developers – who subsequently went into administration – for a hotel in Fletton Quays which was expected to be ready in 2019.

Last year, the council agreed to instruct administrators to sell the site, and on Tuesday its leader, Labour's Shabina Qayyum, told BBC Radio Cambridgeshire she was "very glad".

She subsequently said it had been sold to "somebody who will make it into a high-end hotel".

The council has been asked how much it is being sold for, but Qayyum said the "reality is there has been a loss on the sale".

It is not clear how much of the money it lent to developers the council will get back.

The hotel was planned with a rooftop bar and al fresco terrace overlooking the River Nene.

The scheme began under a Conservative administration, which has previously said the project failed because of the Covid pandemic and costs of building materials rising "three times".

The 160-bedroom hotel is about 80% complete but major works are still pending, including to its lifts and gym facilities.

A sales brochure said it would cost an extra £14m to complete.

In a statement, a city council spokesperson said: "Following the marketing exercise which concluded in January,administrator Teneo has been working with an interested party and contracts have now been exchanged.

"We cannot comment any further until the sale has completed. It remains our ambition to see the hotel completed and open as quickly as possible."

The council, which is having elections on Thursday, is under a Labour-led administration, alongside the Liberal Democrats and Peterborough First.

Qayyum told BBC Radio Cambridgeshire's Chris Mann show: "This administration, under my leadership in coalition with the other groups, has made a fiscally responsible decision of closing that, not spending a penny more of taxpayers' money and selling it."

She said the hotel was "not going to be used for asylum seekers and for refugees, as has been peddled by some of the other groups".

John Howard, from the Conservatives, said the area the hotel stood in used to be a "wasteland", and that the Hilton was a "kickstarter", adding "the council invested in it to show confidence in that area which, if you look now, has transformed in those years since".

He said they "couldn't have foreseen Covid" and did not agree with the sale.

"We have made the wrong decision to sell it for a crushing loss at the worst possible time when we could have still sought a partner to finish the hotel and operate it which would have brought the money back over, in fairness, a much longer period – maybe 20 to 30 years."

Leader of the local Liberal Democrats, Christian Hogg, said it was "great news" the hotel was being sold.

"I've said all along we needed to get it sold, get it done, take the hit," he said.

"It's been going on for far too long... it's been just sat there. Ultimately, it's deteriorating, it's going down in value, not up in value, so we need to absolutely get rid of it.

"The council is not a developer; we shouldn't be looking to develop it further."

Heather Skibsted, leader of the Green group, said the sale was "a good thing in that we've been waiting all these years it's been stood there empty".

"As far as the Green group is concerned, that should never have happened in the first place because we're not in the business of running hotels and taking risks with taxpayers' money," she said.

There should have been more due diligence and robust scrutiny and lessons needed to be learned, she added.

Reform's first councillor on the authority, Andrew O'Neil, said: "The council doesn't have a good record in terms of corporate-style investments, and I think we should concentrate in the council on services for local people."

Asked if sale of the hotel was a relief, he said: "It needed to be done, yes.

"If we can use the money to reduce the debt the council's got then we're saving on the interest payments serving that debt, so the sooner that's done probably the better, but obviously we'd like to see the best price secured for it."

A full list of candidates taking part in the Peterborough City Council elections on 7 May can be found on the authority's website.

Update 5 May: A previous version of this story said the sale of the hotel had been completed. This was based on comments made by Shabina Qayyum. The council has now clarified that the sale has only been agreed and the story has been updated to reflect this.

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