Contracts have been exchanged on a half-built hotel that has stood unfinished since the pandemic, with the council potentially facing a multimillion-pound write-off on money lent to developers who later went into administration.
Peterborough City Council leader Cllr Shabina Qayyum has confirmed that a sale has been agreed on a half-built hotel project abandoned during the COVID-19 pandemic, with some reports suggesting the authority could make a loss of around £13m on the deal.
The project was originally backed by a Public Works Loan Board loan in 2017, with the hotel due to open in 2019. Repeated delays pushed that date back, and the developers – who had borrowed £15m from the council – ultimately went into administration.
Following a marketing exercise that concluded in January, administrators Teneo exchanged contracts with an interested party.
A council spokesperson said it is ‘inevitable’ that a significant portion of the debt will need to be written off, though the exact figure cannot be confirmed until the sale completes. They added it remains the council’s ambition to see the hotel finished and open ‘as quickly as possible’.
