The businessman behind the multi-million pound proposal to redevelop the site of old bus station in Douglas says he is confident that it will go ahead.

Conor Bradley, the commercial director of Kane Ltd, has spoken to the Isle of Man Examiner about the difficulties the company has had in the wake of the Covid-19 crisis and has hit out at the way the government has dealt with it.

Kane Ltd has also faced stumbling blocks as two prospective tenants have gone into voluntary insolvency.

The project envisages a cinema, a 198-space car park and restaurants in the Lord Street development.

It also would be a ’transport hub’, serving buses.

A number of other proposals for the site over the last 20 years have failed. Mr Bradley said: ’This is clearly by far the closest a deal for this site has got to getting off the ground.’

Asked how confident he was that his development, as planned, would succeed, he replied: ’I am confident that this will go ahead.

’However if a key tenant ultimately fails, it is possible that a varied but similar scheme will still go ahead.’

The government forced Lord Street Development SPV to pay the balance of over £1m for the site on May 4 this year, unwilling to give it an extension to the deal both parties had originally agreed three years earlier.

Mr Bradley said: ’Unbeknown to ourselves at the time of exchanging contracts in 2017, a completion date set for May 4, would land in the midst of the global coronavirus pandemic.

’Prior to Covid-19, the Quayside North project had been making strong progress, with key tenant commitments secured and a £15m senior lending facility agreed in principle and with start on construction expected between May/June of this year,’ he said.

funding

He said that the company sought an agreement with the Department of Infrastructure to push the currently contracted May 4 completion date to buy the land back by three months initially to give time to assess the impact of Covid-19 on the proposed tenants and funding, and to also complete the tender process of the built contract that had been delayed because of the pandemic.

One big problem is that two of the three ’anchor tenants’ - Pizza Express and Travelodge - have since entered into insolvency procedures.

Mr Bradley said there were no problems with the prospective cinema.

’There is going to be a period of time where we need to see this stabilise,’ he said.

talks

However, Mr Bradley said that the company is in talks with other companies.

After Kane’s appeal to delay land purchase date was rejected by the DoI, the company tried again and pointed out that this decision would leave the Lord Street car park unused at a time when the promenade development was exacerbating parking problems in Douglas.

Mr Bradley said his company did not want to run parking on the site itself.

’We reminded the DoI that it would be forfeiting any and all parking income it would continue to receive if it were to simply agree to our request of pushing the completion date back by a couple of months, as they could continue to operate the car park as per normal whilst we continue our work in the background.

’The DoI reiterated its position, seemingly with little to no regard to the fact the world economy was falling apart, and that we were contractually bound to complete on May 4.

’While refusing our reasonable request to delay they did then make an offer to lease the car park but that they would only do so if we leased the site back to the government for free.

’We could only infer from that position that the DoI was not at all concerned about a potentially unnecessary and substantial drop in parking provision, and that they must have alternative provisions in place - one such provision that we had heard of was that a planning application was in the offing for a temporary solution over Parade Street.’

He said that LSD SPV Ltd countered the DoI’s offer to lease the car park for free and suggested the DoI retained the majority but paid it a smaller percentage (less than 25%) of the parking income for the site, to reflect the fact that the site would have then been paid for in full and which the company now owned.

He added: ’There has not been any communications with the department in relation to interim parking since completion and we have not made any proposal to the department requesting that we run the site as a car park, as we have no interest in doing so.

’We are actually able to operate a number of spaces on the site, and after toying with the idea following an approach from a local business, we have since dropped those plans.’

He added: ’The DoI was frustrating our commercial position by refusing to delay the May 4 completion date, requesting payment in full for land value, bringing our expenditure on this project to nearly £3m (£92,000 of which went towards a planning application fee) and the only circumstance where the car park could stay open to the public during and following the pandemic is if our company agreed to lease the entire site back to the DoI at a peppercorn rent.

’ Again we could only presume at the time that the DoI had other plans in place, which ultimately doesn’t seem to have been the case but we did not regard that as a credible offer.’

He added: ’We desperately want to see the project become a success and hope for a positive economic recovery so that we can start on site in the new year.’