Ipswich confident investment income will continue to boost funds
PUBLISHED: 16:02 04 June 2020 | UPDATED: 16:18 04 June 2020
A council-owned company set up to provide investment income for Ipswich remains confident its strategy will be profitable, despite the current economic turbulence and a government inquiry into councils’ property deals.
Ipswich Borough Assets owns commercial property in the town and in other locations in the East of England – it recently bought an office-based business park at Peterborough.
It finances these deals with money borrowed by the borough from the Public Works Loans Board, which is lent at a very low interest rate compared to commercial lenders.
However, there have been calls for these loans to be confined to investments within a council’s area – which would prevent such a loan being used to buy property many miles away.
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But the threat of a change in the rules does not concern IBA chairman and borough councillor Colin Kreidewolf, who remains confident the deals will be good for the council and residents.
He said: “We are still seeing very good returns from our investments and we remain optimistic. We bought the business park at Peterborough to diversify both geographically and in the sector of business – we have a lot of retail premises.
“We don’t know what the commission will say and how it will affect us, but we remain confident that the business model will work for us.”
One development that the council is confident about is a new Amazon distribution centre that is based at the Eastern Gateway park – the borough-owned former sugar beet site just outside the town boundaries at Sproughton.
Mr Kreidewolf said that although the building appeared nearly finished on the outside, there is a great deal of work to be done finishing it off internally. It is to be a new delivery centre with 40 full-time staff members and servicing 200 drivers taking goods to customers across Suffolk and north Essex.
He said: “I know some people feel this is a threat to traditional retailers – but online retailing is a fact of life now and, after the last few weeks, more and more people are using it. The fact is this will bring more jobs for Ipswich people and we have to see it as good news in those terms. The work on the site is continuing and it should be up and running in a few months.”