Exclusive: i360 tower to get the go-ahead – with help of £36 million public loan

The i360 is set to receive a financial lifeline with councillors confirming they will gift developers a £36 million public loan, The Latest can reveal.

After many false hopes, a deal to bring the 600-foot tall viewing tower to a seafront site near the West Pier will be discussed by Brighton and Hove councillors next week.

The proposal is for the city council to act as a middle man in drawing down a £36 million loan from the government and then hand the money straight over to developers.

The Latest can now exclusively reveal that a majority of councillors on the cross-party panel will support the plan when it is discussed publicly.

With planning permission already obtained it means that work could start within months – nearly a decade after the scheme was first unveiled.

Documents outlining the deal and how the council would benefit are set to be released on Thursday.

But The Latest understands that part of the repayment deal, which will be spread over 27 years, will mean developers Marks Barfield, who were behind the London Eye, handing over 1% of all ticket sales to the council.

Sources add the local authority will receive £1 million in fees as well as the difference in interest rates between the rate borrowed, which will be a peppercorn public works amount, and the repaid amount, which will be commercial.

It is understood the difference could be as much as 3%.

The council will receive a further six-figure sum as new government rules means it can keep part of the business rates generated.

Council leader Jason Kitcat said: “The i360 developers have shown they can deliver successful tourist attractions elsewhere, and we believe they can do the same here.

“Not only will Brighton and Hove get a landmark that will put us on the international map, and bring additional visitors to our city – but it will regenerate an area where businesses are struggling.

“That’s why the i360 has strong support from local residents and businesses.

“To help bring this positive project move forward, we are working hard to get the best deal possible for the city, and will be able to share more information about the proposals at the end of the week.”

As well as the loan, developers have secured a £3 million grant from Coast to Capital, the area’s local enterprise partnership.

The four Green councillors on the ruling committee look set to vote for the loan, the three Labour members against.

But it’s the stance of the Conservatives which is the most interesting with party members being split on the issue.

After a lengthy behind closed doors meeting last night, Tory councillors agreed to support the idea of a loan.

This is despite a number of people in the party being against the idea.

Speaking to The Latest, Conservative group leader Geoffrey Theobald said: “This hasn’t been an easy decision and we have given it very careful consideration over a number of weeks but in the end we believe that it will be in the long-term interests of the city to take this bold step.

“If we don’t grasp the nettle now, the seafront which is our shop window, will suffer a slow and inevitable decline for decades to come.”

He added: “Many councils are now using this route of borrowing money at a low interest rate from the Government and lending it on again at a commercial rate to kick start private sector projects.

“In addition, the money which the council will make from this loan arrangement, plus the extra business rates that will come in, can be spent on additional council services.”

In contrast, Brighton Kemptown MP Simon Kirby has already said he opposes the deal.

He said: “While I am incredibly supportive of efforts to support tourism in the city, I am concerned at the cost to taxpayers to get this project off the ground.

“This project has been beset by issues already and I have reservations about the likely return for taxpayers.

“It is revealing that the required amount of private finance has not been secured.

“I would urge caution from the council to ensure that taxpayers hard earned money is not poured down a black hole.”

Former council leader Mary Mears and Hangleton and Knoll councillor Dawn Barnett are thought to be among at least four Tory councillors with reservations about the idea.

Labour has unanimously agreed to oppose the loan.

Labour group leader Warren Morgan said: “If private investors would not take on this risk then why should the public have to?

“We believe the risks are too great and the rewards too small for this massive gamble to be worthwhile.”

The issue will finally be resolved on March 6 at a special meeting of the council’s policy and resources committee.