Brighton's i360 to be given financial breathing space
The Brighton i360 is to be given a financial breathing space, subject to political agreement at a meeting on Thursday (June 28).
A report to councillors published yesterday (Monday 25 June) recommends deferring a £570,000 payment until the end of the year.
But Brighton and Hove City Council has budgeted up to £50,000 to pay a specialist consultant to look at refinancing options for the £50 million seafront attraction.
And the council may also insist on sending in a consultant to the Brighton i360 to bolster the company’s financial performance.
This financial breathing space, which is expected to be agreed, will give the council, the i360 and the Coast to Capital Local Enterprise Partnership (the LEP) until the end of the year to reach a long-term deal.
The council brokered a £36.2 million loan for the i360 from the Public Works Loan Board.
Under the deal the i360 pays the council £570,000 every six months – or £1.14 million a year.
The i360 also borrowed £4 million from the LEP which is due to discuss the matter at its next board meeting early next month.
So far all payments due from the i360 have been made on time and the report to councillors said that the business had already generated an extra £2.4 million for the council.
And the attraction has directly created 116 jobs on site, with three quarters of those staff coming from the local area.
But visitor numbers have been below forecast, with bad weather and unreliable trains among the reasons being blamed.
The council said that the new i360 chief executive Steve Bax had taken about £450,000 of costs out of the business.
He is said to have brought a renewed focus to driving up visitor numbers and generating extra revenue from other sources.
The report to councillors says: “Despite the lower than anticipated visitor numbers, the i360 has been a major revenue generator with over £12 million gross income and £3 million net operating profit achieved to date before financing costs are taken into account.
“The council needs to respond to the anticipated default and engage in dialogue with the LEP and the i360 to agree loan restructuring which secures the future of the i360 in the long term thereby protecting the council’s investment.
“A further report will be brought to Policy, Resources and Growth Committee on (Thursday) 6 December.”
Potential restructuring and proposed financial breathing space and are due to be discussed at a special meeting of the council’s Policy, Resources and Growth Committee at Hove Town Hall on Thursday.
The meeting is open to the public but the crucial financial details may be discussed behind closed doors, with a “restructure proposal” set out in a 34-page confidential report.
Sarah Booker-Lewis , Local Democracy Reporting Service