Colonnades purchase is massive gamble with public money

CROYDON COMMENTARY: Spending millions to buy a private business risks feather bedding property speculators, says DEREK THROWER

Might the council be propping up the private sector?

Under a Conservative government, local authorities, including Croydon Council, are being given public cash to nationalise private assets and land. That’s quite extraordinary considering these Tories are supposed to be a free market economic liberals who subscribe to the Thatcherite hypothesis of how state ownership eradicates entrepreneurial activity.

Not a whimper has been heard from the local council’s Conservative leadership over the latest purchase, the £53million deal for the Colonnades retail and leisure centre, and so we can only assume they have been fully consulted over these actions.

Let’s offer an alternative analysis over the Colonnades purchase from that offered by the council.

One is that they are purchasing this for public land to facilitate future house-building. That is more plausible, perhaps, for this site than the premium location at East Croydon of the Croydon Park Hotel, which they bought previously.

Or perhaps they are now trying to prop up the local land market and prevent developers incurring book losses on their investments. How attractive would a location such as Croydon look if property prices began to fall, just as you want them to make huge investments and facilitate the development of the Whitgift Centre and its surroundings?

Council CEO Jo Negrini: risks presiding over a white elephant

To my mind, the council is gambling with public funds to enable development in the short to medium term.

Not a bad idea, perhaps, over a long-term, 30-year loan where by the end of it, the current economic malaise engulfing this country will be long forgotten, but still a huge gamble with tax-payers’ money. Sure, after 30 years this will look absolutely fine, but let’s be frank about this.

This council is now feather bedding property speculators with large sums of money that clearly could be put to better use elsewhere. Isn’t it better for property prices to find their real value and enable investment decisions to be made from there, rather than for the sake of Jo Negrini’s career and the massive white elephant that is now the Whitgift Centre?

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3 Responses to Colonnades purchase is massive gamble with public money

  1. David Wickens says:

    Article in the national media yesterday suggesting 200 shopping centres in danger of going into administration.The Colonnades is not quite a shopping centre but the economics are probably similar.

    • As referenced in our original report, David.
      It’s a bit like the council going into the property development business with Laings in CCURV, just as the worldwide crash depressed property values for five or six years.
      Or going into the house-building business just as there’s a downturn in house prices…

  2. The Colonnades with one shop, Wickes, one Gym and two restaurants, one kids place and Costa has almost as much parking as one of the big supermarkets….guess what is going to happen.

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