The i360 is expected to miss another £1.5 million repayment to Brighton and Hove City Council at the end of next month.
A report to councillors said that officials were trying to finalise a restructuring of the loan, which would mean a revised payment plan.
But senior councillors would probably be asked to sign it off in the spring rather than by the end of this year as previously planned.
Officials said that they wanted reassurance that the seafront visitor attraction had a credible five-year business plan and they were taking expert advice from Leisure Development Partners LLP – also known as LDP.
A report to councillors said: “Strong steps are being taken by the i360 and there are clear signs of recovery and a credible five-year business plan is being developed to ensure the attraction will be able to pay off the loans owing.”
The council hopes to receive a repayment in the spring although the carefully worded report to the council’s Policy and Resources Committee did not say how much.
The council brokered a £36 million loan for the i360 from the government’s Public Works Loan Board – and the Coast to Capital Local Enterprise Partnership (LEP) handed over a further £4 million.
The council has since taken over the LEP loan – at no cost to the council – but three years of missed payments mean that the i360 now owes more than £45 million in total.
The report said that i360 had had a “strong beneficial impact … on the local economy” and “the attraction has acted as a positive beacon for seafront regeneration”.
It also said that lower than expected visitor numbers had led to repayments being deferred, adding: “In particular, the covid pandemic has had a significant impact on income and cashflow into the i360.
“Since January 2019 (the board and management of the i360) have taken steps to turn around performance and manage costs. However, the impact of the pandemic is of course still being felt.”
Positive steps have included bringing in-house the previously outsourced management of the restaurant and conference space, leading to a “notable increase” in catering revenues in the summer.
The report to councillors said: “New revenue streams, and improved publicity and social media coverage, have been driven by innovative ideas such as the iDrop abseiling and the Tower Climb. Other new plans for diversifying revenue streams are being explored.
“The Skybar (in the pod) and the retail shop have both shown strong performance recently, up on both comparative years and on budget.
“A lot of strong marketing and PR work has been done, with the attraction … used for high-profile outside broadcasts, with Good Morning Britain using the pod for weather forecasts.
“The £4 million loan from Coast to Capital LEP to the i360 has now been transferred to the council, at no cost.
“That element of the loan will be restructured at the same time and amalgamated into one single loan.
“Repayment of that part of the loan will see the council receiving £4 million over the life of the loan that it would not have otherwise received.
“The restructure is likely to be based on a similar concept as previously: the i360 agree a business plan that sees their visitor number grow over a five-year period and the council undertakes a ‘cash sweep’.
“This means taking all available money in the business that is not needed to remain operational and solvent.
“Eventually, once visitor numbers improve, this cash sweep will see the council taking enough money to cover the loan payments – and potentially more to reclaim our lending more quickly.
“Until the restructure is completed, the terms of the existing loan agreement apply. This would mean a payment of £1.492 million becomes payable on 31 December 2021.
“There is still not enough cash in the business to cover that. Instead, it is proposed that the December 2021 payment is not taken on that date.
“The recommendation is that the council should complete the restructure in spring 2022 and then take a payment upon completion in line with the terms of the restructure.”
The council’s Policy and Resources Committee is due to meet at Hove Town Hall at 4pm on Thursday (2 December). The meeting is scheduled to be webcast on the council’s website.
The council really is running out of excuses. Dubious claims that “the attraction has acted as a positive beacon for seafront regeneration”.
Really? Was that part of the seafront run down? No
However, the i360 replaced the wheel which was in a much less visited area – an area that needs regeneration and investment. So a more correct claim would be that the i360 hindered seafront regeneration.
The i360 was failing financially before covid, and even worse since! All the reports and the postponement of debts just mean one thing – we’ll be paying for this mistake from our council tax one day
The i360 was never needed. The wheel was liked and another one has been welcomed recently. The Green/Tory alliance who voted for it should be ashamed. The private sector decided that the i360 wouldn’t work financially – that should have been a big clue! Instead, the green/tory councillors went ahead with our council tax and services as an effective guarantee
B&H council, no financial acumen, like Nick, just pass the buck and go back to 2014.
What have the Greenies and Labour been doing since then?
Surely not deferring and waiving loans away with no financial investigation whilst each were in power, have they?
Even before the lockdown excuses this was a sorry story.
Shut it down and put it behind us.
The claim that visitor numbers will improve is frankly for the birds. Once you have been up the i360 you are highly unlikely to want to go again. So gradually the available pool of customers reduces. In 5 years time visitor numbers will be lower than they are now. Maintenance costs will increase as the machinery ages in the harsh seafront environment. Financially the project is holed below the waterline and as doomed as the Titanic once it had hit the iceberg.
People objected to the Wheel in 2011 – and then complained when it closed a few years later, as agreed at the outset.A problem for the i360 is the end of conferences. It was intended as a draw for those who attend such things, but the world has now changed.
What’s that scraping noise? Oh yes, the sound of the Council’s barrel of excuses getting a good working over
The i360 has been glad to have Covid as an excuse to avoid paying anything back. What would have been their excuses without the virus? I hope none of the creators of this mess have taken a wage from this. I expect they are still profiting while we have to pay for their mess
it was patently obvious right from Day 1 that this monstrosity would never make money. The very fact that thirteen other councils had already declined the opportunity to have on their manor should have been a bit of a clue for B&H Council, but no. I hink i t has made money; I’m sure the architects made a nice return on selling the design, and the construction company won’t have been left out of pocket. Its just us, the local council tax payers who never wanted the eyesore in the first place who are going to have to stump up. Write it off, demolish it and let’s move on.
The sums never added up, footfall projections were ridiculous, and the conference crowds were not going to make this white elephant pay. Not then, not now, not ever. Financial negligence and no-one held to account. In pre-COVID times I have many visitors and I always used to take them on the wheel. I have been on i360 twice and won’t do it again. Unlike the wheel it is not the type of attraction someone wants to visit more than once or twice. Time to write off the loans………
This was never going to turn a profit or pay back the taxpayers loan
Anyone who says different is being economical with the truth, as politicians say
Everyone knew this lift would fail here and so it has proved.
OUR councillors should be protecting the local tax payers and notletting the debt mountain grow and grow
If they say it’s £45million you can bet its nearer £50million
But who cares? Certainly not our officials
BA gave up the wonderful Eye for Brightons pie in the shy