THE value of a bankrupt council’s cinema and supermarket purchase has dropped by millions of pounds, but bosses think it can still attract a good deal.

As part of a major disposal programme, Slough Borough Council is selling up to £600m worth of its properties and land in order to reduce its £680m borrowing debt and bridge its £479m blackhole.

Council leader James Swindlehurst (Lab: Cippenham Green) previously said the four out-of-borough assets were the first to go as non-operational assets outside Slough that are “not loved” by residents are no longer needed.

The council is trying to raise £50m in 2022/23 from asset sales with an aspiration to raise £100m by March 31, 2023, to pay off its debts. It wants to raise between £400m and £600m by March 2027.

READ MORE: Waitrose and Odeon Basingstoke: The costs of assets bought by Slough Council

Officers have recommended senior councillors to sell off the Odeon Cinema in Basingstoke, the Wickes store in Wolverhampton, a Waitrose in Gosport, and a Expect Distribution warehouse in Bradford.

According to the report, the properties were bought between 2017 and 2019 for a total of £31.8m. They were bought as investments to pump revenue into the council’s budget – but the yields they gave were not as generous as the council originally thought.

However, property advisor Avison Young said the Odeon and the Waitrose have fallen in value by £5.2m due to Covid-19 and inflation affecting the cinema market.

The supermarket trade in Gosport has fallen and the Waitrose in the area has not traded well. So much so that Waitrose bosses have said they do not wish to extend its lease when it expires in 2025.

Slough Observer: The Waitrose supermarket in GosportThe Waitrose supermarket in Gosport (Image: Google Maps)

Two bids were received for the Basingstoke cinema, whereas only one bidder was interested in the Waitrose supermarket.

The other two assets have largely maintained their value and have had significant interest and bidders.

Slough Observer: The Expect Distribution warehouse in Bradford garnered a lot of interest when it was put on the market earlier this year The Expect Distribution warehouse in Bradford garnered a lot of interest when it was put on the market earlier this year (Image: Google Maps)

The current total value of all four assets is £26.6m. However, the total offers on the Bradford warehouse and Wilkes store exceed current valuations by £1.3m, meaning the council could bag £27.9m – a £3.9m loss.

The report states this nearly £4m loss will be written off to the capital adjustment account in the council’s balance sheet. Selling the properties will also reduce its borrowing costs by £644,000.

Commissioners sent in by the government to help fix the council’s financial governance woes strongly supported the sales but will talk with external auditors on whether the council’s purchases were a ‘good and appropriate’ use of public money.

READ MORE: Slough Council "very close" to selling off properties

They stated it was ‘unclear’ what professional valuation advice was given when the four assets were bought.

They also stated: “It is hard to see why the council, in the light of this information, could have decided that these investments were a good and appropriate use of public money.

“Commissioners will discuss with the external auditors whether this matter should be formally referred to them for investigation and report.”

A decision will be made by senior councillors at a cabinet meeting on Wednesday, September 21.