Newcastle City Council is planning to buy an office tower, developed for Northern Rock before it was nationalised, for £22m.

The council is looking to buy the 120,000 sq ft Tower at the Regent Centre in Gosforth.

The council will use debt to buy the office but interest payments for the loan will be funded by rental payments.

It is understood that a tenant has been agreed to occupy the building and will sublet one floor back to the council. Discussions are ongoing for a further one and a half floors to be sublet to another company.

The property, completed in November last year, was developed for £35m and was brought to the market in September 2008 with a price tag of £27m.

The proposal to buy and lease the building will go before Newcastle city council’s executive board tonight.

Earlier this month energy firm Npower bought Northern Rock’s other new build office, the 220,000 sq ft Rainton Bridge in Sunderland.

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