Council net debts mount to £289 million.

The Councils net debts increased to £289 million in the year up to April 2020. 

That was an increase of £43.4 million over 12 months.

The figures are revealed in a report to a meeting taking place this week.

The Council net debts are forecast to increase to £452.4 million within the next 5 years.

This will mean that nearly 25% of Council Tax income will be spent on interest and redemption charges.

The figures don’t take into account the toll that Coronavirus has had on finances over the last 4 months.

Although interest rates are at historically low levels, the Councils income steams have been badly hit. In turn this affects the authorities ability to service its debt charges.

Projects which depend on asset sales for funding are also facing challenges. The commercial property market may be depressed for several years.

The report fails to provide an update on the assumptions made about commercial letting returns.

 As well as an expanded shops portfolio, the Council has embarked on a  series of projects, like the Community stadium and the Guildhall renovation, which depend partly on rent income from office and commercial space to pay for the investment.  

Empty offices at Monks Cross

Several Council owned offices are currently empty.

The Council, is particularly reluctant to say whether the speculative offices, which it agreed to underwrite at Monks Cross, have yet found a tenant.

Empty offices at Clifton Moor to become flats?

Clifton Moor office empty

The York Council is to remove restrictive covenants from some commercial properties in Clifton Moor.

This will allow buildings to be converted into residential use.

The Council says that it is doing this because there is little demand for office blocks on the development and a lot of property is empty.

The Council also claims that demand for City centre offices is buoyant.

The covenants were imposed several years ago when the area was first developed.

The area suffers from significant traffic congestion which is unlikely to be sorted until expensive improvements to the northern by pass are completed.

There are some fairly big question to be answered about the quality of residential accommodation that could be provided by converting modern office and commercial buildings.
Huge areas of green field land have been reserved for this purpose – including a nearby site at Westminster Business Park – with many sites being some miles from the City centre.Behind closed doors logo
 It also brings into question (again) the assumptions that the Council has made in its draft Local Plan about the demand for office and commercial development land in the future.

The Councils decision was taken at a “behind closed doors” meeting.

There was no consultation with local residents or businesses about the proposal.