£33 million spent by Chorley Council to buy warehouse – with hopes of £1 million profit every year
More than £30 million has been spent by Chorley Council to secure the long-term future of an industrial site in the town.
The authority is the new owner of the 300,000 square foot Logistics House distribution warehouse at Revolution Park in Buckshaw Village, one of the North West’s major distribution sites, as part of a £33 million package to increase revenues for the council in a time where the authority has faced significant government funding cuts .
Some £31 million was spent to secure the site, with taxes increasing the overall cost by a further £2 million.
The move comes after TVS Supply Chain Solutions, which has called the warehouse off Buckshaw Avenue its home since 2006, decided to sell the building with plans to lease it back.
“The purchase means we can retain TVS in Chorley with over 300 people employed on site and another 45 jobs being created with a new Network Rail contract that has just started,” said Coun Alistair Bradley, Leader of Chorley Council.
The contract is an eight-year deal valued up to £300m and will see TVS SCS supporting Network Rail to transform part of its Material and Logistics supply chain.
The council is now hoping to make £400,000 profit every year from the site, rising towards £1 million per year over the course of 15 years.
Chorley Council has lost more than £4 million in government grants since 2014/15, including the total removal of Revenue Support Grant and the reduction and proposed removal of New Homes Bonus – a grant that councils receives when new homes are built.
Coun Bradley said: “With the huge cuts in government grant we have seen over the years if we are to continue to improve services for residents we have to generate our own income from commercial ventures particularly where that also supports our commercial sector and protects jobs.
“This deal came about in a similar way to the purchase of Market Walk, which has been a fantastic move for Chorley, with the imminent opening of the extension that will bring more visitors into the borough.
“As with any deal like this there is always an element of risk but we’re comfortable that it is an opportunity that we couldn’t turn down and it was supported by councillors of all parties who recognised the benefits to all residents of our borough.”
TVS is part of a global logistics group based in India and with employees in more than 50 countries throughout Asia, North America and Europe incorporating Coca Cola, Coors, Diageo, Electricity North West, Isuzu and Babcock among its clients.
Other occupiers on Revolution Park include GA Pet Food Partners, Conair, Kimberley Clark, and Parcel Force.
“The success of projects like Market Walk, which generates £1 million per year, means we have been able to keep council tax rises to a minimum and we’ve been able to make investment in major projects across the borough, such as the Croston flood relief scheme, which has recently saved hundreds of homes from flooding in the recent bad weather,” added Coun Bradley.