Disagreements Over Scarborough Water Park Rent

Scarborough Borough Council has disputed what it says are “inaccurate” claims made by the developer of the Alpamare water park regarding Covid-19 rent payments that led to legal proceedings.

Claims that the council agreed to suspend rents for the Alpamare waterpark “during the Covid-19 period is inaccurate”, according to Scarborough Borough Council, which says it was forced to start court proceedings against the parent company of the developer.

In 2013 the authority gave a £9m loan to the developer of the water park, Benchmark Leisure, to ensure the project went ahead, eventually opening in 2016. The company is also involved in a number of other local developments.

In a statement issued to the Local Democracy Reporting Service, Benchmark Leisure said:

“The council had originally agreed that rent payments due to it under Benchmark’s headlease would be suspended during Covid, as the council had done with some of its other tenants – like the Travelodge in the town centre – but then changed its mind and took Benchmark’s parent company to court for non-payment.”

The company also said that it subsidised the operation and maintenance of the waterpark “to the tune of over £300,000” during the pandemic to ensure that facilities were improved and that staff were not laid off.

However, a spokesperson for the authority said:

“Benchmark’s claim we agreed to suspend rents for the waterpark during the Covid-19 period is inaccurate. We did not agree to suspend rent during that time and it would not have been appropriate to do so without going through our formal decision-making processes.”

It added:

“Prior to the court date we received payment from the parent company for all non-Covid-19 rent arrears and reached an agreement for the settlement of all Covid-19 rent arrears and interest.”

The authority also disputed the Travelodge example as “not comparable”.

The loan for the water park, which is located in the North Bay, has “courted controversy since it was advanced in October 2015”, according to Benchmark. It added that “after the council changed its mind about taking a headlease… the only way the Waterpark project was viable was for it to be delivered” on specific provisions.

It stated that it required provisions to recover its £5m+ portion of the construction costs from future developments at North Bay and that “the £8.9m loan from the council would be a low-interest rate loan on the same or better terms” than it would have received under the original headlease terms.

A further provision stated: “Benchmark would be entitled to take full ownership of the Waterpark and the additional parking at Burniston Road once it paid off the loan in full in the next 30 years.”

Scarborough Council said that in 2020 the council leader approved a short-term extension to the 2002 development agreement to “explore whether it was possible to reach agreement on terms to extend it in the long term”.

However, according to the authority, the company “failed to provide” it with sufficient assurance and detail “to justify any further work being undertaken so the development agreement came to an end on March 17 2021”.

A council spokesperson added:

“Under the terms of the waterpark lease Benchmark still has the opportunity to buy the waterpark.

“This is subject to the company repaying the £9 million loan it was provided with for the waterpark development in full. The outstanding figure currently stands at £7.85 million.”