The Chichester Enterprise Centre project has cost the district council almost a quarter of a million pounds less than predicted, a meeting of the cabinet has been told.
The management of the business centre, in Terminus Road, was handed to Basepoint in March, weeks after building work was completed.
The project had been allocated a total budget of £6,245,860 from capital reserves, but has only cost £6,011,014 to deliver – an underspend of £234,133.
At a meeting in East Pallant House, Chichester, on Tuesday, December 4, the cabinet was told that, since opening, 35 of the 82 offices and workshops had been filled, with a further three companies using the centre as a virtual office where their mail is delivered.
Seventy-two people are employed at the site, and discussions are ongoing to lease another two workshops and six offices.
Basepoint had predicted that the centre would be 40 per cent full after 12 months but, with three months to go to the first anniversary, that figure has already been exceeded, reaching 44 per cent.
Council leader Tony Dignum described the performance as ‘very encouraging’.
He added: “The original project objectives have been fully achieved.
“These included bringing a brownfield site back into active economic use and, through that, the provision of flexible business accommodation that helps fledgling businesses manage their costs as they grow.
“Added to this, a programme of business development initiatives run by Basepoint is helping to encourage new businesses within the district and support job creation.”
Development of the centre was certainly not an easy ride.
Originally proposed in 2009, there was little initial interest from developers, and the partner who was eventually selected by the council later pulled out of the project.
There were additional obstacles during construction when major ground contamination issues were discovered.
On the positive side, the centre will provide the council with an annual income.
The meeting was told that, because of the underspend, the return on the investment had improved and, at Year 5, would be 5.15 per cent of Basepoint’s minimum guaranteed income.
With that guaranteed income totalling £2,819,155 over ten years, this should build up to around £15,500 for the council coffers at Year 5, together with an additional profit share.