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Regular news: Issue 608 26 Oct 2012

Council mulls loan for new train station

Leeds Councillors are considering a developer’s request for a loan to finance a new rail station in a key development area.

Commercial Estates Group, an agent acting on behalf of development company GMV Twelve Ltd, has requested assistance from the city council to deliver the station at Kirkstall Forge on the Leeds-Skipton/Ilkley railway line, around four miles north-west of the city centre.

The station would serve a 23-hectare brownfield site on which there are plans to provide 1,045 residential dwellings and 300,000 square feet of offices.

GMV Twelve Ltd had planned to start site development in advance of the opening of the rail station. But Doug Meeson, Leeds City Council’s chief officer, financial management, said lenders were reluctant to provide finance for such developments because of the slow recovery of the first time homebuyer market and bad debts from previous commercial and residential loans.

The city council has not revealed how much funding the developer is asking for, though officers said “substantial sums” were needed.

Meeson said there were “sound economic reasons for the council to respond positively to the request”. But he said “further work is required to gain an understanding of the capacity of the development to generate the value necessary to repay any support from the council”.

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