Edinburgh City Council is poised to buy its head office in a £91m purchase from Aviva Investors that could save Council Tax payers up to £38m
The council met yesterday to decide whether to buy the 194,000 sq ft Waverley Court building from Aviva’s Norwich Union Life and Pension Fund (NULAP).
Edinburgh council pays £5.1m a year in rent, but this is due to rise to £6m in November 2011, £7m in 2016, and £8.3m in 2021.
The council could fund the purchase through the Public Works Loan Board and pay the loan back over 28 years at an interest rate of 4.75% at a total cost of £6m a year.
A report to the council yesterday predicted this could save taxpayers £37.7m over the next 10 years.
Donald McGougan, the council’s director of finance, said it would consider using capital receipts, currently invested in funds to pay the council’s rent obligations, to provide equity for the loan.
The committee report said that earlier this year NULAP approached the council to see if it wished to buy its headquarters.
The building, which houses 1,800 staff, was marketed by King Sturge and it is understood that there was interest from several UK and foreign parties.
Aviva Investors and King Sturge declined to comment.