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6 June 2018

i360 fact check

The i360 is the most visited paid-for attraction in the city and has helped raise the profile of our visitor offer nationally and internationally.

Repayment of the government loan financing facilitated by the council is not at risk.

The attraction is asking for a degree of flexibility. We will still receive the full amount agreed to, in the same timescale, but with flexibility on payment dates. 

The attraction has been a catalyst for the regeneration of an important part of our seafront and has provided economic and community benefit for the city as a whole. Since its opening in 2017, we have received £2.5m in revenue and this income means we haven’t needed to use other resources during a time of continuing austerity.

Howard Barden, head of Brighton & Hove City Council's tourism & venues says: “The i360 is a new business and it isn’t unusual for a business to reschedule loan repayments in the short term to sustain profitability in the long term; it’s a sensible and pragmatic business approach.

“The attraction has already proven itself as a popular visitor draw and has made a significant contribution to the city’s local economy. In less than two years of opening, it has provided over £2.5m to the council, money that we would not otherwise have had.”

Background

  • The i360 made an operating profit in its first year and will do so again this year.
  • The attraction is asking for flexibility on its profit margin payments to the council.
  • Payments would continue to allow the council to repay the Public Works Loan Board (PWLB) loan; the council would still receive the full amount agreed to, in the same timescale; but with flexibility on payment dates. 
  • During the period of reduced margin payments, the other benefits remain – e.g. profile-raising, jobs, boost to local economy, charitable works; and 1% of ticket revenues to the council. The private shareholders receive no payments until the other commitments are settled. 
  • Commitments made in the Council’s budget have and are being met ie the £1 million for Madeira Terrace is in the bank and 1% of ticket sales for community groups is due in November (in the budget). 
  • The council receives three separate streams of income from the i360 amounting to approximately £1.3m each year. (This includes the margin on the loan, 49% of business rates and S106 1% share of ticket sales).
  • Income from the i360’s business rates supports the funding of all council services. Under current government regulations, we keep 49% of the business rates paid by the i360).   
  • The payments from the i360 exceed the loan repayments by about £1.1 million every year. Currently we have received £2.5m in revenue since opening in 2017. By receiving this income, the council has not needed to use other resources during time of continuing austerity.
  • We received just over £960,000 of fees from the i360 for the arrangement of the £36m PWB loan. This money has been spent on landscaping work on council owned property around the i360. 
  • There has been £1.9m of investment in the area surrounding the West Pier on council owned land, allowing for a new piazza and events space as well as 15 new shops and galleries to open with business rates and rental created. 
  • The event space hosted events during the Brighton Festival and activities are planned for later in the year, breathing new life into this previously unloved section of seafront. 
  • The i360 pays the council 1% of their income from ticket sales. Under a Section 106 agreement (agreed in 2006) the i360 provide 1% of ticket revenue, in perpetuity, to a defined area in its vicinity. This money is to assist with ongoing improvements, investment and maintenance of the area. We are in talks with the community about how this can be spent.
  • Councillors make decisions about which seafront projects to fund. 

A report (PDF) detailing the i360's request to reschedule its loan repayments will be presented to Brighton & Hove City Council's Policy, Resources and Growth Committee on 14 June 2018.