Questions over taxpayer loan for stalled Leeds hotel

A committee of West Yorkshire councillors is expected to confirm next week they are launching an inquiry into the way the loan was made.

It remains unclear whether the £4.8m loan to support the building of a new Leeds city centre hotel will ever be repaid.

The Leeds City Region Local Enterprise Partnership - a body made up of council and business leaders - gave Oxford GB2 the loan to help get the £32m hotel plan off the ground.

Construction of the Hilton-branded hotel began on a former car park site close to Leeds Civic Hall.

But building work ground to a halt when Oxford GB2 went into administration in 2015.

No significant further work has been done at the site for more than two years and become an eyesore.

The West Yorkshire Combined Authority, which brings the area’s councils together to work on growing the economy, oversees the actions of the local enterprise partnership.

Councillors on the combined authority’s overview and scrutiny will next week consider whether to carry out an investigation into the loan.

A report to members points out the money came from a fund designed to support “higher risk projects”.

“There have been some notable successes within this portfolio of projects, however this particular project has attracted media attention for the stalled project,” the report says.

The building site was recently put up for sale for around £6m.