The City Council’s Cabinet is set to accept a further £12.24 million grant from the West Midlands Combined Authority (WMCA) to make City Centre South viable. This is in addition to the £98.8 million pounds already provided by that Authority.
The £110 million grant is designed to make the scheme viable and acceptable. In particular the scheme now includes 20% affordable housing, which was not included in the original scheme approved by the Council.
In addition to the £110 million provided by the WMCA the City Council is understood to have “recycled” £28.7 million of a WMCA grant into the scheme as well as about £9 million of its own resources (£4 million of gap funding and £5.25 million of capital receipts).
According to the Council “City Centre South (CCS) will deliver transformational improvements to Coventry city centre through the creation of a new residential led community providing new homes, jobs, commercial and leisure opportunities and high-quality public spaces.”
According to the report “The £98.8m WMCA grant funding acknowledged the reality of the “market failure” in this part of Coventry and the economics associated with bringing forward a city centre scheme of this nature.”
Even with this level of subsidy, it appears that the scheme is only marginally viable, and it appears that a large proportion of the risk has transferred from the developer to the public sector. Following the failure of Friargate the City Council seems to be backing yet another high-risk development.