Plymouth City Council is owed £23,000 by big wheel owners
PLYMOUTH City Council is £23,000 out of pocket after the closure of the big wheel.
The council said it is owed cash for non-payment of “fees” relating to the wheel’s Hoe site.
It is understood this may include rent.
Some of the cash relates to the administration of the attraction’s former operator, Birmingham-based Great City Attractions Global Limited, which brought the 53-metre high structure to Plymouth last summer.
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The Herald can reveal that when it went into administration on July 20, and ceased trading, that firm owed £6million in total.
The debt was the result of operating wheels in Plymouth, York and Liverpool, and in some other locations.
A huge proportion of the money is owed to secured creditors HSBC bank and Dudley amusements firm Shipley Investments Ltd, which owns the actual wheel structure and rented to Great City Attractions.
Other prominent creditors include HM Revenue and Customs, and in York £77,727 is owed to the Royal York Hotel, and £50,300 to City of York Council.
Administrator Jason Groocock(CORR), from Leicester-based G2 Insolvency Limited, said there were creditors in Plymouth too, aside from the city council.
It is likely this will include 20 former employees plus some businesses.
A Plymouth City Council spokesman said: “The council is owed £23,000 as a result of non-payment of fees on the land since April 2012.”
However, as reported in The Herald on Friday, the situation surrounding the wheel has now become more complex.
Following Great City Attractions administration, Shipley, which retained the Plymouth and York wheels, brought in new operator The Hall Organisation Ltd.
“It has the same director as Great City Attractions – Elliot Hall – but there’s no other connection,” said Mr Groocock.
But last week the wheel suddenly closed, even though it had been granted permission by the council to keep running until December 31.
Meanwhile, the administration of Great City Attractions is continuing, and Mr Groocock said it would probably take about another six months to be resolved.
“There are a number of creditors on the schedule,” he said. “There’s some sizeable amounts, particularly for the (Plymouth City) council, for the use of the site.”
He said any creditors on the site would be notified and receive claim forms.
“The process is ongoing. It’s relatively early days,” Mr Groocock said.
He said Great City Attractions was hit by a lack of “cash and investment” and a “mix of things culminating over a short space of time”.
He said: “There were issues with ongoing rental payments stemming around cash flow problems, in turn from lack of custom.
“Weather played a part too, and choice of location and set-up costs.
“Each time they allocated a wheel to a city it took time and money setting it up, often a few hundred thousand pounds.”
No-one at Shipley Investments Ltd could be contacted on the advertised number.
The Herald contacted The Hall Organisation Ltd but at the time of going to press had not received a statement.