Councillors are expected to approve the sale of a Victorian goods shed in Peterborough to pave the way for its transformation into a high quality food hall.

The listed railway building at Fletton Quays is being sold in a £7 million venture that will see it become part of The Vine cultural and community centre.

Members of Peterborough City Council’s ruling cabinet will be asked to approve the sale of the building for £250,000 to Farholt Goods Shed Ltd, of Kettering and approve a grant scheme for £1,895,000 to drive the redevelopment of the building.

The land surrounding the building will continue to be owned by the council to ensure public realm, outdoor seating space remains available.

The Victorian good shed at Fletton Quays, Peterborough

placeholder image — The Victorian good shed at Fletton Quays, Peterborough

Yet councillors will be told that redevelopment of the Grade II building, which is subject to planning permission, raises some financial concerns.

They will be told by officers that ‘at this stage there is insufficient assurance that the revenues generated from the operation are sufficient to fund the level of developer investment required.’

A statement submitted to the Cabinet adds: “The grant agreement puts an obligation on Farholt to provide three monthly cashflow forecast and bank statements for that period which will ensure sufficient funds are held at stages of the project.

"If the transaction doesn’t complete, the council does not hold funds to bring forward the food hall.

It highlights that ‘the council’s funding will be limited to the Towns Fund grant allocation of £1.895 million.

“Farholt will fund the remaining capital cost and will need to address the remaining viability gap through a combination of value engineering of the capital works and optimising the revenue operation to achieve a sustainable enterprise.”

The council purchased the building from the Peterborough Investment Partnership for £250,000 in February 2024.

Councillor Mohammed Farooq, Cabinet Member for Growth and Regeneration, said: “This proposal represents a key milestone in the ongoing regeneration of Fletton Quays and wider city centre, aiming to bring new life into a historic building, which whilst requiring significant investment, presents an exciting opportunity to provide a unique offer for people to enjoy.”

The Goods Shed is one of eight projects in receipt of the Government Towns Fund programme, which saw £22.9 million approved for investment into projects across the city to drive economic regeneration.