CINEWORLD remains committed to its Newport cinema site according to the council that owns the city’s leisure park.
The cinema chain struck a deal last autumn to negotiate lower rents on a number of its sites across the UK after struggling to recover from the Covid enforced lockdown in March 2020.
The deal, which was approved by the High Court, included the cinema at the Newport Leisure Park, also known as Spytty Park, which is owned by Monmouthshire County Council that purchased the site in the neighbouring city council area for £22.5 million in March 2019.
Nicholas Keys, the council’s acting head of landlord services, said the cinema is confident of an upturn in its fortunes due to blockbuster films scheduled for releases.
He told councillors: “Cineworld have paid a reduced rent since December and they are not currently in arrears or have any debt since that period. I speak to them regularly and they say to me all cinema is improving with the various blockbusters coming through, and they are currently paying us as they are supposed to.”
Mr Keys said the rent reduction at the leisure park is “significantly lower”, in favour of the council, than at some other sites.
The reduced rent will remain in place for a three-year period and has been factored into the council’s financial projections that show the leisure park is due to break through the two per cent return on investment criteria that had been set at the time of purchase by March 2026.
The leisure park is currently generating a net return on investment of 1.44 per cent while currently just one of the 11 units at the park is vacant with no tenants in rent arrears. The site was fully let when purchased by the council but suffered a number of closures following the pandemic.
In the 2024/25 financial year the park generated a net income, after borrowing repayments, of £285,222 to the council.
The former Pizza Hut unit at the park has been let to Horizon Vets, which is expected to open in May, while the former Tiffins restaurant which the council required forfeiture of the lease in January 2024 remains empty.
There has only been limited interest in taking it on and potential occupiers have been put off as a lack of space has meant creating a drive through window hasn’t been feasible.
Consideration is being given to partitioning the unit into two smaller units to increase the attractiveness to smaller leisure offerings.
Terms have also been agreed with an electric vehicle charging company to hire parking spaces as charging points. An application for connection to the National Grid has been made though planning permission will also be required. The council will benefit from a fixed annual rent and profit share that will improve the financial projections outlined to councillors if permissions are granted.
The Castlegate Business Park, in Caldicot, continues to operate at a loss to the council, which bought the site for £7m in 2018 with borrowing and other costs attached. It ran at a loss of £111,348 during the 2024/25 financial year.
To produce the two per cent return on investment Castlegate would need to be 95.8 per cent occupied. In March this year the occupancy rate was 87.7 per cent, which is slightly down on the previous report in October as a film production company’s temporary brought its short term rental agreement to an end.
Interest in a number of units at the business park, and renewed or new lettings, have been reported and the council also states since September 2024, 32 new skilled jobs have been created or appointed to at Castlegate Business Park which overall provides 307 jobs.
Councillors were told since acquisition, both assets have generated a total income of £2,216,948 above borrowing repayments for the council.
In total the council’s investments and commercial property portfolio, which includes its solar farm, industrial units in Caldicot and Raglan, the county farm estate and office space, generated £3,871,507 gross income for the council in 2024/25 which was above the £3,756,652 budgeted for.
