M&S loss triggered biggest drop in value of council-owned Saddlers Centre
The loss of the flagship Marks and Spencer store saw the value of a Walsall Council-owned shopping centre plummet, auditors have revealed.
Saddlers Centre was bought by the then Labour-led authority back in 2017 for a total cost of £13.8 million but current valuations show it is currently worth just under £4 million.
Members of the council’s audit committee discussed the issue at a meeting on Monday when looking at the statement of accounts for the 2020/21 financial year.
While the latest accounts show a decrease in value of under £500,000 for that year, officers said the figure dropped drastically over several years – most notably when Marks and Spencer shut.
The department store giants closed its doors for the last time in 2018 and the huge unit has sat empty ever since.
Robert Page, senior accountancy officer, said: “The largest reduction was in 2018/19 which was the year Marks and Spencer vacated their lease in the building.
“That has a significant effect on the overall value of the property.”
The centre was dealt another blow in 2019 when TJ Hughes’ store fell by the wayside while the pandemic has also impacted and resulted in more closures.
But this has been countered recently with several units being taken up while a huge Covid-19 vaccination centre was created in the vacant TJ Hughes site.
The Conservatives criticised the purchase when in opposition in 2017 and have continued to do so since regaining power in 2018, although it forms part of their 'Masterplan' aimed at breathing new life into the town centre.
Leader Mike Bird revealed the current vale of the Saddlers was £3.9 million at a full council meeting last week and said those who voted against it had been vindicated as the centre was now making a loss.
He added: “I think it was ill timed by the Labour group of the day, ill thought out and now the people of Walsall are picking up the tab.”
But a report showed auditors highlighted a number of risks such as a failure to have contracts signed with the management company and sharply rising rent arrears during 2019/20.
In response, Walsall Labour group leader Aftab Nawaz said: “Since they took over, they have mismanaged the running of the Saddlers Centre.
“If they managed it properly then perhaps it would have been different.”
