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09
Dec 2023
Taxpayers bear multi-million pound losses on Harrogate's vacant Royal Baths
The long-term vacancy of two prime retail units in Harrogate's Royal Baths has cost the taxpayer almost £1 million in lost rent and service charges, the Stray Ferret can reveal.
North Yorkshire County Council paid £9.5 million for the Grade II listed building in 2018. A current council report has valued it at £7 million and forecasts it to generate an investment return of just 1.64%.
But in addition to the £2.5 million decline in property value, the long-term vacancy of both buildings is haemorrhaging lost rental income each month.
A year ago today (December 9, 2022) the council evicted the owners of the Viper Rooms nightclub — one of four commercial units it lets in the Royal Baths.
The venue has stood empty since, despite repeated claims by the council of "significant interest".
The former Potting Shed bar, which along with the JD Wetherspoon pub and Royal Baths Chinese Restaurant make up the other commercial units, has been empty since the council acquired the historic complex five years ago.
The Stray Ferret asked North Yorkshire Council, which succeeded North Yorkshire County Council in April this year, about the cost of the ongoing vacancies.
A council statement said rent for the Viper Rooms premises "would have been in the region of £90,000 since December last year".
It added maintenance for the building is covered by a service charge which is approximately £75,000.
The council added no business rates are payable due to an exemption for the premises as a listed asset.
As for the Potting Shed space, the council said the original rent was £125,000 a year when the county council acquired the vacant unit in 2018. That figure represents a loss of £625,000 over five years.
The vacant former Potting Shed unit.
It did not give a figure for the loss of service charge income at the Potting Shed but said no business rates were payable on either premises due to an exemption for them being a listed asset.
The council said "no agent’s fees have been paid at this time" to Savils, which has been marketing the Viper Rooms, adding any fee "will be made when the unit has been let".
Asked why it was taking so long to find a Viper Rooms tenant, despite the apparent interest, the council said:
Council urged to "get their act together"
Former Conservative councillor Richard Musgrave branded the Royal Baths an "under-performing trophy asset" in 2021 because of the sum paid and returns generated.
The continued loss of rental income since, the depreciation of the value of the asset and its low investment returns has again raised questions about the council's business acumen.
The Royal Baths forecasted return of 1.64% is by far the lowest in the council's portfolio.
Cllr Stuart Parsons, leader of the Independent group on Conservative-controlled North Yorkshire Council, said the situation was "extremely concerning". He said:
Cllr Parsons said the newly formed council was still going through its investment portfolio to decide which assets to keep.
The Royal Baths complex
Tom Gordon, the Liberal Democrat candidate for Harrogate and Knaresborough at the next general election, said:
Read more:
- Harrogate's Royal Baths: the council's under-performing 'trophy investment'
- Harrogate nightclub Viper Rooms closes suddenly
- Viper Rooms owner says Harrogate landlords need to 'get real' with rent
Asked to respond to claims that it lacks the commercial acumen to run businesses, the council said:
Paul Kinsey, who owned the Viper Rooms, has been locked in protracted negotiations with the council over the fixtures and fittings, declined to comment.
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