Luxury Coombe Abbey Hotel set to get millions more of Coventry council taxpayers' money - The Coventry Observer

Luxury Coombe Abbey Hotel set to get millions more of Coventry council taxpayers' money

Coventry Editorial 2nd Oct, 2018 Updated: 2nd Oct, 2018   0

MILLIONS of pounds more of Coventry council taxpayers’ money is set to go to the listed Coombe Abbey Hotel.

The latest plan is to loan the now council-owned luxury hotel’s operating company up to £1.95million.

The medieval-themed grade 1 listed venue was bought by the council last year for up to £11million, as we exclusively revealed.

A council officers’ document to go before the ruling Labour cabinet later today states: “Now that CAPL (Coombe Abbey Park Limited) is 100 per cent in the ownership of the city council, there is an opportunity for the city council to provide a capital loan facility to CAPL on a commercial basis rather than CAPL obtaining these facilities on the open market.




“The city council refinanced CAPL on 29th November 2013 with a loan which is repayable over 15 years ending in November 2028.

“CAPL continues to service this debt from its existing revenue streams under the city council’s ownership, and the securities from this loan remain in place for a further 10 years.


“It is proposed that a maximum facility of £1.95million is made available to CAPL over the next 10 years, this period is in line with the city council’s existing loan facilities to CAPL.

“The new £1.95 million facility will ensure that appropriate security is obtained in order to protect the council.”

The document indicates the loans will help the hotel meet capital outlays in future, giving the example of previous loans taken out for a new boiler.

Councillors will also discuss building a high wires assault course at the park in which the hotel stands.

There are also plans for a second cafe for Coombe Country Park in Top Pool Lodge.

In 2013, the council bought out the then struggling hotel’s £6.5million bank loan. The council took over as mortgage lender to the privately owned medieval-themed hotel, which could then borrow at much cheaper interest rates.

At the time, Labour council leaders assured council taxpayers the hotel’s post-credit-crunch problems, when profits halved, were temporary, and the loan would be repaid.

While the expensive four-star 119-bedroom hotel was privately owned since the 1990s until last year, the popular picturesque 500-acre park surrounding it has long been run by the council, which is also the freehold owner of the hotel’s land.

The council previously owned the hotel too, when it was considered a drain on resources, before a public-private partnership was set up in the 1990s.

UPDATE:

Opposition leader, Conservative councillor Gary Ridley said: “I’m not sure what qualifies a local authority to run a hotel and they should never have purchased it in the first place.

“This loan is another example of poor leadership from this failing Labour administration which seems determined to put more taxpayer’s money at risk.

“They should ditch this Fawlty Towers fantasy as soon as possible and focus on their core mission of providing services to the people of Coventry.

“At the moment it feels more like a real life game of monopoly and it’s the people of Coventry who’ll pick up the tab.”

But Jim O’Boyle, Labour cabinet member for jobs and regeneration, said the Coombe Abbey Hotel buyout and loan arrangements were on track to bring a seven-figure return to the taxpayer.

He said a partnership with Go Ape to provide the high wires assault course would see revenues shared between Go Ape and the council owned hotel.

He added: “We will share in the overall profits of the business.”

He said the Conservative group had in effect included the profits from the Coombe Abbey Hotel venture in its alternative budget plans earlier this year.

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