Inside story of the collapse of the Blackpool Central developer Nikal
PLUS: Our new print edition is out, Devolution white paper reaction in Blackpool and looking into why men die young
The firm which was supposed to be leading the £300m redevelopment of Blackpool Central hit financial catastrophe as a result of its involvement in the troubled site.
Manchester-based property developer Nikal Ltd was appointed to oversee the transformation of the former train station grounds into a world-class leisure facility. It completed work on a multi-storey car park which forms one aspect but collapsed into administration in November.
Blackpool Council says the setback does not affect its ambitions for the site and is already in the process of finding another developer to lead the project. This week, it announced it has appointed Birmingham-based DSM Demolition to knock down the old police station, courts, and joke shop on Central Drive
The main part of the site has sat empty for half a century and was once supposed to be home to a super-casino under plans during the New Labour government. Those fell through and while Blackpool South MP Chris Webb has floated the idea of building an arena there, the council wants to create a major complex with a hotel, restaurants and indoor theme parks.
The Blackpool Lead can now reveal it was Nikal’s work on the Blackpool site which pushed it from being in financial difficulty into complete collapse.
The first hit was rising cost forecasts for the future phases of the development before an additional £4.6m demand from its contractor pushed it over the edge.
Administrators Paul Stanley and Mark Weekes of Begbies Traynor detailed the financial problems felt by the once thriving company, which had enjoyed positive growth between 2015-20. However, the impacts of Covid-19 and Brexit led to aborted sales, more caution from investors, rising interest costs and more complex sales processes.
Over time, more issues were found with its existing developments and as a result the CEO and CFO both departed the business and a new strategy was put in place to focus on finishing existing jobs and then focus on Blackpool Central.
The administrators explain: "Completion and subsequent realisation of the existing developments started positively and by September 2023 there had been an internal group reorganisation which left Nikal and its subsidiaries with no external funding. At this time, phase 1 - the building of a multi storey car park of the Blackpool Central project was under way.
“However, it was at this time that the company began to experience issues. The remaining historic developments were those deemed to be difficult and which proved more problematic to complete and realise the expected proceeds.
“At the same time, revised projections for later phases of the Blackpool Central Project were showing the project not to be financially viable. This was as a result of cost inflation, high interest rates, and excessive risk factors. Blackpool Corporation acknowledged this and asked Nikal to suspend further work on the later phases.
“Meanwhile, the car park [..] had been completed and a sale agreed, however, the building contractor indicated in spring 2024 it would be claiming additional sums back from Nikal, with this claim totalling c£4.6m.”
The report explains the company had intended to run down all developments by the end of 2025, with no prospect of continuing any involvement in Blackpool Central. While the firm hoped to continue to fund its obligations to wind down in an orderly manner, it lost an adjudication process and was ordered to pay the £4.6m immediately. High court action was launched to recover the sum and the company, with no way of paying, entered administration.
Work is now ongoing to attempt to recover whatever funds can be repaid to those owed money by Nikal.
Meanwhile, the council says its plans for the site will continue and The Blackpool Lead’s analysis of the administrators’ draft state of affairs indicates the authority has not been left out of pocket.
Demolition work is expected to begin in early 2025 and is being funded by money awarded through the government’s Town Deal.
Reaffirming the authority’s commitment to the project, council leader Cllr Lynn Williams said: “Blackpool Central sits right at the heart of our plans to make Blackpool better for everybody. We’re committed to attracting a world-class leisure development that creates jobs for our local people, extends our tourism season to be all year round and supports our local economy to grow.
“In the last five years at Blackpool Central, we’ve made more progress on this site than the 50 years before it since the Blackpool Central train station closed in the 1960s, largely paid for by the private sector without risking council tax payer’s money.
“The road to regeneration isn’t always smooth but we will not stand still. We will continue our plans to demolish the courts and the police station early in the new year, in order to create a shovel ready site for a new leisure attraction.
“We have very high standards for the type of attraction which this site needs and any future scheme will have to match those ambitions. To deliver on that we need serious investors and we will be heavily marketing this opportunity to get that international calibre of attraction.”
The Blackpool Lead’s third print edition is here
Landing on doormats and in supermarkets during Wednesday 18 December you can enjoy the best of our newsletters in hard copy as well as some exclusive new features too. It’s a special edition focused on the housing crisis as well as some of our in-depth news and features about Blackpool too.
This is our third free newspaper in Blackpool and we’re delighted to bring it to you.
Discover more about it and where you can grab a free copy.
If you can’t make it to the shops for a copy, then you can tap here to see an online version.
Row over Lancashire’s political map not going to be resolved any time soon
By Luke Beardsworth
The release of the long-awaited Devolution White Paper was admittedly lacking in detail.
The topic is one long in detail but, for the moment at least, short in impact. The reality being that Lancashire as a whole had ultimately been providing spoilers about what was to come for much of the last few months.
The takeaway of the scrapping of two-tier authority set-ups doesn’t necessarily impact Blackpool Council directly. Blackpool is already the ‘unitary’ set-up that the government has now confirmed it is looking to achieve.
But Wyre Council and Fylde Council, both of whom have expressed reservations about both the broader strategy (due to the need to serve local concerns) and the specific point about pairing with Blackpool (they don’t want to take on the town’s well-documented issues), are highly unlikely to continue in their current form.
And in geographical terms now, it’s hard to see a world where at least one of them isn’t folded into a broader Blackpool/Fylde Council.
It’s also increasingly challenging to see a scenario where Lancashire doesn’t elect a mayor in 2026. This would unlock further funding for the county as a whole - as it has done so effectively for Manchester - but the *many* local leaders in the county could feel their influence is being affected by the government’s plans.
The move has been welcome by Labour MP for Blackpool South Chris Webb, who believes the devolution white paper will be a necessary weapon for fighting deprivation in the town.
He told The Blackpool Lead:
“I welcome the government’s plan for devolution by default. 14 years of Conservative rule has disempowered local authorities with central government stripping away vital resources – £1.4 billion has been directly taken from the people of Blackpool. The devastating impact of these cuts is visible at every turn in my constituency.
“A strong devolution deal for Lancashire will create a progressive local government that works for the people. The current tier two deal, earmarked for Lancashire in 2025 and initially negotiated under the Conservative government, is insufficient and lacks ambition. It’s a deal that will hold Lancashire back, leaving us at a disadvantage compared to our more economically vibrant neighbours of Greater Manchester and Merseyside which have a directly elected mayor and greater powers.
“A tier three deal, with an elected mayor as seen in other combined authorities across the North and beyond, will unlock billions of pounds for Lancashire. More importantly, it would bring real power – power that should lie in the hands of local people, not distant politicians in Westminster.
And Cllr Lynn Williams, leader of Blackpool Council, told The Blackpool Lead:
“We very much welcome the ideal that local decision making should be moved further away from central government and that decisions should be made at a local level and by those that are closest to the communities it affects.
“Blackpool has already started on the journey of devolution with the Combined County Authority which promises to give enhanced decision making and more power over decision on issues such transport and adult learning.
“ Whilst we recognise the Government’s desire for Mayors to cover every area of England and their preference for a simpler system of local government in two-tier areas, ensuring that the needs of Blackpool residents are fully met is and always will be my upmost priority.”
But Cat Smith, Labour MP for Lancaster and Wyre, has previously raised the point that all of these plans ‘risk undoing’ advances in women’s political representation. The mayors elected in England so far have been largely male (three of 11 are female) and, frankly, we hear a lot more from Andy Burnham and Ben Houchen than we do Kim McGuinness and Claire Ward.
But that side of the debate may have distracted from the point that she wanted to make - the absence of female representation in her most recent statement was telling.
Instead, she expressed concern that taking an one-size-only model of local government would overlook how diverse an area like Lancashire is.
She said:
When you look at our messy two-tier local government in Lancashire, you can see it is confusing. Often it is also three-tier with active parish councils too! Sometimes even I struggle to get my head around which council does what, and it’s not always logical. I am not saying what we have now is perfect, but it is what has evolved over time and reflects the nature of our communities.
So when Jim McMahan hovers his ministerial pencil over the map of Lancashire and tries to shoe horn it into a model he knows well in Greater Manchester my plea is this; please stop and listen to the people who live here. I don’t believe there is any appetite for a mayor. The only arguments I am hearing for it are that we have to take it in order to get access to government funding. This is totally back to front, why should we be taking a model which we don’t want, probably won’t work in order to access the funds our constituents need? Look again at if we can improve local government but let’s not come in with a fixed idea one an identikit model of large unitary authorities and metro mayors.
Just down the coast – and within hours of the white paper being published – Tory-led Fylde Council passed a pre-planned motion opposing its own abolition, which it was claimed would “jeopardise the democratic accountability, service quality, and community focus” that authority offers.
That was according to council leader Karen Buckley, who added: “Instead of dismantling a system that works effectively at a local level, efforts should be directed toward improving collaboration between different tiers of government while preserving the vital role of district councils.
“Local government should remain local—close to the people it serves and reflective of their unique needs and priorities.”
And Wyre Council’s Conservative leader Michael Vincent said that the super-sized standalone authorities that are set to replace the likes of his – and which will serve populations of around half a million residents – are “not local government”.
“It’s called the devolution bill, but it’s not devolving power to traditional councils – it is taking power away from [them],” Cllr Vincent said.
The lack of local detail means that what the white paper, released on Monday (16 December) really means for Lancashire as a whole is something we knew well before it was published: the debate is going to continue for a while.
Why do men die young in Blackpool?
By Shelagh Parkinson
Health chiefs in Blackpool will investigate issues such as drug and alcohol addiction to learn more about why men living in the resort now have the lowest life expectancy in the UK.
Figures published in December by the Office for National Statistics (ONS) show men in Blackpool can expect to live for 73.1 years which is six years less than the national average of 79 years and 10 years less than prosperous areas such as Hampshire.
Average life expectancy for women in Blackpool is just under 79 years, compared to the national average of just over 83.
Deprivation is blamed for the poor health outcomes in the town, with many people moving to the resort from other areas of the country with pre-existing illnesses and conditions.
Coun John Boughton told a meeting of Blackpool Council’s Tourism, Economy and Communities Scrutiny Committee: “I was concerned to read life expectancy for men in Blackpool is now the lowest in the country.
“Have we got information about why this is going in the wrong direction? We need it to go in the opposite direction. Statistics out this week show men in Blackpool will live 10 years less than men in Hampshire.”
Liz Petch, a health practitioner from Blackpool’s Public Health Team, said there were plans to explore more deeply why life expectancy is so low for men in the town.
She said: “We will be looking at drug related deaths, male suicide rates etc. These are issues which mean some people die much earlier than we expect which impacts our life expectancy.”
The meeting heard there were many men who died in their 40s due to longstanding addictions.
Life expectancy also differs widely within Blackpool itself with those living in more affluent neighbourhoods living much longer. One reason for this is those in poorer areas are less likely to take up screening opportunities or vaccinations offered by the NHS.
Drug deaths in Blackpool are almost four times higher than in the rest of England, and up 50 per cent in the past decade with 120 drug deaths between 2020 and 2022.
The figures, from Blackpool’s most recent annual public health report, also show more than two-thirds of those dying due to drugs are men, while twice as many men are dying from suicide compared to women in Blackpool, with the town having the sixth-highest suicide rate in the country.
News in headlines 🗞️
Tributes for Man City fan from Blackpool who died after collapsing at Manchester derby (LancsLive)
Kiena Dawes trial hears claim fiancé made 'Ferne McCann acid attack threat' (LancsLive)
Rayner promises mayor for every region of England (BBC)
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We’ll speak to you again on Sunday.
Ed & Luke and the Blackpool Lead team
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