Hunt for urban village developer cost £870k

Finding developers to build Bilston's Urban Village cost £870,000, it can be revealed today.

The funds were used in the early stages of the £200 million project to transform more than 100 acres of derelict land in the town.

Wolverhampton City Council's audit committee was told that the money had been spent on legal fees and a competition process which lasted for two years, where bidders offered their services to build a £15m leisure centre, 1,000 homes, a medical centre and a £23m academy.

It was also revealed that the firm behind the first 120 homes has yet to secure funding, eight months before work is due to start.

Construction of the new leisure centre near the Black Country Route is due to start in the new year and take 16 months. It will open in spring 2011 to replace the Prouds Lane centre, and will house two swimming pools, a sports hall, squash courts, fitness suite and café.

Councillor Keith Inston, who represents East Park for Labour, said at yesterday's audit committee meeting: "How was it possible to spend £870,000 securing a developer? I think we're all in the wrong job."

He was told by regeneration officer Simon Lucas that all the funds were from outside agencies such as Advantage West Midlands.

Out of 19 bidders, the winner was Places for People Ltd.

The company is currently trying to obtain funding to build the first 120 homes, starting in the middle of next year, by applying to the government's Kickstart 2 programme.

Details of the amount of cash needed were not revealed, and a planning application has yet to be submitted.

Spring Vale's Liberal democrat Councillor Mal-colm Gwinnett said he was concerned about the scheme's chances of getting off the ground.

He said: "If a company can't raise funding for 120 houses then that is a problem. It is not that big an area to construct."

Mr Lucas said the council would hear very soon whether Places for People had been successful in its bid.