Sale of unfinished pigeon-infested hotel to proceed

The hotel on Fletton Quays is about 80% complete

A Conservative-led proposal to block the sale of an unfinished pigeon-infested Hilton hotel has failed.

Peterborough City Council borrowed £15m from the government to loan to developers for the project in Fletton Quays in 2017.

The council cabinet's decision to agree to instruct administrators to sell the site in Fletton Quays earlier this month was called in for further scrutiny by Tory councillors.

But councillors on a scrutiny committee of the Labour-run authority on Monday decided the original cabinet decision should stand.

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

Prior to the meeting, Conservative John Howard warned the council could risk losing up to £14m with the cabinet's decision.

He said: "The advice before has always been to build out the hotel with a partner... and it's always been said that would be the best way out for the council."

John Howard fears the cabinet's decision could cost the council up to £14m

A rooftop bar and al fresco terrace overlooking the River Nene were included in the original hotel design and were expected to be ready in 2019.

But eight years on, the 160-bedroom hotel remains unfinished and unoccupied.

The hotel on Fletton Quays is about 80% complete but major works are still pending, including lifts and gyms.

Mohammed Jamil, cabinet member for finance and corporate governance, told Monday's meeting the decision was "not taken lightly".

He added that the "recommendation to sell" had been "based on updated valuations and risk assessments".

There had, he continued, been "significant private sector interest" in the site, which could "bring it into use as quickly as possible" and that the "Hilton group continues to support this project".

"Our position is such that we can't afford any further mistakes."

He urged the committee to "move forward with clarity and confidence".

"If I could've done it in a different way, I would've done, but we are where we are," he added.

Referring to a proposal to put conditions on the sale, he continued: "When you restrict you may not get best value. That for me is where the gamechanger is."

Conservative Steve Allen said: "We must remember – it's more than a building, it's a statement about the kind of city that we may have."

He added that selling on the open market risks losing hotel use, attracting low bids and risks undoing years of regeneration work.

The decision was passed by the scrutiny committee by six votes to three.