Medway Council has approved the purchase of the lease on the Pentagon shopping centre in Chatham town centre for £45m.
Announcing the move, which was agreed by full council last week, the council said it hoped to generate an annual income of £1m from the centre to plough back into supporting council finances and services for local residents. It said the acquisition of the centre would also “help mitigate against the kinds of development in the proposed city centre that would not enhance the area”.
Built as part of the redevelopment of Chatham town centre in the 1970s, the shopping centre now contains more than 70 shops and seven leisure facilities, including many fashion, homeware and food stores. However, this week it was also announced that the centre’s MFA bowl indoor centre had closed down after the owner was unable to find a buyer.
In December the BBC reported on research from commercial property consultancy Knight Frank, which found that since 2016, councils have bought 26 shopping malls, including ten in 2018. They include Surrey Heath BC and Wigan and Bolton MBCs. The practice has attracted controversy, with some critics questioning whether retail is a sound investment in the current climate.
Medway leader Alan Jarrett (Con) said: “This presents a really exciting opportunity to bring forward more major improvements in what is expected to become Medway’s leading waterfront university city centre. Chatham has a rich naval heritage, with the historic dockyard attracting millions of visitors each year, and this investment is planned to further support our existing regeneration programme for the town.”
Medway council also agreed to acquire other included freehold properties, and up to £45million will be added to the Capital Programme to allow for the acquisition of the Pentagon Centre’s head leases, the fees and additional enabling works.