Neptune theatre future hangs in balance

Oct 2 2007 by David Bartlett, Liverpool Daily Post

THE future of one of Liverpool’s cultural gems was last night hanging in the balance because of a major funding row.

The historic Neptune theatre shut down in 2005, and now looks certain to be closed during next year’s Capital of Culture celebrations, when it was supposed to play a “central role” in the programme.

The freehold to the Neptune Theatre is owned by Liverpool City Council, which rents it back from Hanover Estate Management, the leaseholder.

In July, 2005, the council agreed to spend £805,000 on the 400-seat Edwardian-style theatre in Hanover Street.

But the council and the Dale Street-based company have been embroiled in a dispute over rent for the past two years. Hanover wants the current rent of £6,000 a year increased to £35,000, while the city has offered just £10,000 a year.

The eventual outcome could be settled by an independent arbitrator but that is not likely to be before the end of the year.

Meanwhile, Hanover has already had two other offers for the site, including one which would see it converted to a bar/restaurant.

The council’s refurbish-ment of the Grade II-listed venue has been on hold for two years, and the original £805,000 cost of the works has soared to £925,000 because of the delay.

Last night, it emerged the council had been served with a dilapidation notice in November, 2004, which eventually led to the proposal for the revamp.

Council leader Warren Bradley said he was committed to doing what was best in the interests of the council taxpayer and said he would not pre-empt the outcome of the arbitration process.

But Labour culture spokesman Cllr Steve Rotheram said the situation was “symptomatic” of the council’s “who is going to blink first” style of negotiation.

The city owns the freehold on what is known as the Crane building, but the whole building is leased to Hanover, which pays a peppercorn rent. In turn, the council rents back the theatre from Hanover and was paying an annual rent of £6,000.

The wrangle is because Hanover not only wants to increase the rent but also extend the lease from its current 39 years to 125 years, at no cost, to enable major work on the exterior of the whole building to take place.

If, after arbitration, the local authority feels the rent is set too high, it can withdraw from the lease and Hanover would be free to rent it to another party.

The company has had an offer from an experienced theatre operator to rent the venue for £45,000 and another from a bar/restaurant offering £80,000 a year.

The theatre was originally supposed to re-open last month, in time for the Capital of Culture celebrations.

But the renovation of the Grade II-listed building, including redecoration, rewiring and asbestos removal, has yet to begin.

Cllr Rotheram said: “The council never fails to astound me.

“It has described it as a jewel in Liverpool's cultural crown, and yet we find out they were not going to spend a penny until their hand was forced.

“I think they are being unrealistic in their offer.

“They have lodged in the court a rent of £10,000 a year.”

David Ramsey, managing director of Hanover Estate Management, insisted the council’s offer was too low.

He said: “You can barely get a rented apartment in town for that, let alone a 400-seater theatre.

“I am prepared to accept £35,000, which is reasonable.

“I want it looking nice for next year, but even if it were agreed now, the building works that the council and I need to do would take nine months.

“I just want to get it done as soon as possible and for the theatre to re-open.

“This could have been done two years ago but they have dragged their feet for two years.”

He said that, without the move to the 125-year lease, financing the replacement of windows and cleaning the outside of the building would prove difficult.

He wanted the lease at nil cost because he would be accepting a below-market offer if he took £35,000.

Cllr Bradley said: “Any-thing we do has got to be fair and best value for the local authority, and Mr Ramsey has an interest because he wants to sweat his asset.”

The council had been working with community groups that would have used the venue to make sure they had alternative accommodation.

He denied the row had become bitter and insisted it was just “one of those things” that the venue would in all likelihood not be open next year.