- Author, Daniel Holland
- Role, Local Democracy Reporting Service
A council will borrow almost £8m to help pay for a major redevelopment of a shopping centre.
Eldon Square in Newcastle is set to undergo a £65m overhaul which would see the former Eldon Leisure Centre and the top floor of the vacant Debenhams turned into new food, leisure and entertainment spaces.
Newcastle City Council, which holds a 40% stake, has agreed to take out a £7.8m loan to contribute to the development, which it is claimed would create up to 900 jobs.
The council, which has to make £60m worth of budget savings by 2027, said the loan was justified as the new spaces were expected to generate £1m a year.
Go karting, microbrewery and theatre
The most recent financial accounts of Intu Debenture, which owns the other 60% of the centre, put the valuation of Eldon Square at £71.2m in 2022, down from £93.2m the year before.
Under the redevelopment plan, the top floor of the ex-Debenhams unit would have live music and theatre, a bar and dining area, an outdoor roof terrace, street food stalls and a microbrewery.
Clothing retailer Next would move from its existing spot into two floors of the former Debenhams store while beauty brand Sephora is set to open a shop later this year.
The second part of the project would see a redesign of the former Eldon Leisure Centre with attractions such as an electric go karting circuit, batting nets, mini golf, bowling and virtual reality games created.
At a meeting of the council’s finance and budget scrutiny committee, head of property Paul Stewart said the loss of Debenhams had been a “big challenge” for Eldon Square but the move to relocate Next was “very good news”.
He said the loan would support the development which in turn would generate an annual income of £1m.
A council spokesperson added Eldon Square was a “significant shopping centre in the heart of our city” and employed about 2,000 people.