Cabinet gives go ahead for Cornwallis Street hotel project

Hastings Borough Council's Cabinet has agreed to recommend an increased budget to enable the Cornwallis Street hotel to go ahead immediately, for approval at Full Council. The hotel has been a long-standing regeneration ambition of the council to bring more much needed additional hotel-beds to our town.

Since the scheme was committed to in early 2021, the costs of construction have increased significantly, and the tenders received back for building the hotel reflect this. The new proposed £13.601m budget also includes an additional amount for contingency. One of the reasons this contingency is needed is that new building regulations will apply to the hotel, meaning it will produce less carbon emissions and include more low energy measures.

The hotel is being built for a national hotel operator who will run it for at least 25 years and will be paying rent and business rates to the council. The council retains the freehold of the hotel. On-going negotiations have also resulted in an improved deal for the council, including higher rent and a reduced rent-free period. The estimated value of the hotel once built has also increased significantly.

The private part of the report (which is not in the public domain as it contains commercially sensitive information) sets out a detailed plan showing how the council will finance the build project. This includes selling surplus assets to reduce the amount of money the council needs to borrow to fund the build. The result is a scheme that more than pays for itself over the lifetime of the project.

Cllr Maya Evans, lead for Regeneration at Hastings Borough Council, explained:

"The establishment of a major hotel group in the town centre of Hastings has been a long-term ambition of the council to counter the well-documented under-provision of hotel bedspaces. As a coastal town, the amount of serviced bed spaces Hastings has to offer is fewer than 1,000, compared to 7,000 in Eastbourne and 13,000 in Brighton. The hotel will be a welcome addition to our local economy, providing year-round job opportunities and local spend for our town through the likelihood of more than 30,000 extra overnight visitors per year.

"Although we need to agree an increase in the capital programme budget for this project, once completed this build will be a valuable asset, one that will diversify the council's property portfolio and generate a steady income."

The Cabinet meeting discussion can be watched here:
Cabinet - 4 September 2023.

Full Council will be discussing the item on Wednesday 20 September at 6pm. This meeting will be available to watch here:
Hastings Borough Council meetings videos.