Council Considers Extra Cash for Property Company Closure

Harborough District Council could spend almost £180,000 more on its loss-making property company after voting to close it down.

The authority is proposing allocating £60,000 to appoint specialist advisers to oversee the voluntary winding-up of Harborough District Commercial Services Ltd (HDCS Ltd).

A further £119,000 could also be made available over the next three years to provide financial support to the company until its assets are sold. Council officers say this represents a ‘worst-case scenario’ and hope the properties can be sold, and the company wound up, much sooner.

HDCS Ltd owns retail units in Market Harborough town centre occupied by Sports Direct and Tesco, along with five flats.

The request follows last month’s decision by councillors, acting as shareholders, to close the company after it recorded losses of more than £800,000 over the past two years.

HDCS Ltd owns retail units in Market Harborough town centre occupied by Sports Direct and Tesco, along with five flats.

The company was established in 2019 to manage commercial property on behalf of the council. However, the authority says changing high street shopping habits, the growth of online retail and the impact of the Covid-19 pandemic have reduced commercial returns.

Although lease extensions have been agreed with Tesco and Sports Direct, the council says the deals are less commercially beneficial than previous agreements, while the flats require investment that would be better undertaken by a future owner.

The properties will now be marketed for sale, with any remaining assets transferred back to the council once the company has been wound up.

The Local Government Association previously said the company’s potential had not been fully realised, while external auditors raised concerns after its accounts were submitted late for a second consecutive year.

Councillors will be asked to approve the additional funding at a meeting later this month.