Work on developing old council offices in Hadleigh into 57 homes will begin this summer, Babergh District Council has pledged – despite costs for the scheme increasing.
But opposition councillors have called for the site to be sold and a greater profit to be made from the sale of the land.
The authority’s cabinet confirmed costs for the development of its old base in Corks Lane had increased by nearly £700,000 as a result of several factors.
John Ward, Independent Conservative leader of the coalition administration, said: “It was important we took the time to find the best possible solution for the local community and the neighbouring cricket club but we now find ourselves in a particularly challenging period of rapidly increasing costs, supply chain issues and uncertainty within the construction industry due to a combination of factors, including Brexit, the pandemic and the war in Ukraine.
“Having considered the options for this site carefully, including a sale, alternative schemes and phasing, I strongly believe the best way to ensure this development is brought forward is to increase the debt threshold for Babergh Growth Ltd.
“This is not about increasing the bill for the taxpayer, but purely to do with cash flow during the phasing of the project and the governance around the amount Babergh Growth Ltd can borrow to deliver it.
“Ultimately the development is still expected to break even or even show a modest profit for the council.”
Hadleigh North ward councillor Dr Sian Dawson from the opposition Conservative group, said: “I am simply staggered that they refuse to accept that labour and materials have increased from a minimum 18% to 35%, which on this basis alone makes this project commercially unviable according to the original figures.
“The site ought to be sold as Babergh are not developers and working with a third party to hasten progression has failed and the project has been dogged by delays.”
The rainbow cabinet of Independent Conservatives, Independents, Liberal Democrat and Green unanimously voted to approve the debt threshold increase.
It means the building contract can be signed this week, and work can start later this summer.
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