Spark:York may be spared from paying a deposit to City of York Council for lease of its site on Piccadilly, under plans outlining support for businesses in the pandemic.
Spark was originally due to close in June this year. But in February the council said the venue could stay for a further two years and issued a fresh lease.
Under the new lease, Spark was to pay a £5,000 deposit to the council which could be used to safeguard the obligations of the lease – for example for unpaid rent.
But council officers have recommended this payment is removed as the venue works to recover from the impact of the pandemic.
A report for a council meeting today says: “The removal of the bond and guarantor from Spark would reduce the council’s ability to offset any future arrears however, given the tenants recent compliance to the conditions as set out, the risk of this is considered to have reduced.”
Spark has no debts to the council. But no profits have been made from the venue the report says, and that this “remains a concern”.
Help needed to survive
It says: “Spark:York have completed the cladding of their facility and have no outstanding debts to the council due.
“Annual trading figures for the previous year have been received from Spark and these illustrate that no profit has been made from the facility having accounted for all running costs including wages.
“Whilst this remains a concern, Spark are confident that the facility remains a viable prospect and all lettable units are currently occupied and in use, which is positive given the Covid-19 situation.”
A Spark spokesperson said: “Despite the challenging trading environment of the past six months, the support we have received from partners including the York BID and council has been instrumental in allowing both the businesses that trade from the venue and Spark:York to survive.”
The council also owns properties in Shambles, Swinegate, offices at Clifton Moor, the Spark:York site and other buildings across the city. Usually the rents bring in about £6 million a year for the authority.
But tenants were allowed to defer paying their rent because of the impact of the pandemic.
A review says that 68 per cent of commercial rent due for the period of April to September has now been paid in full.
Tracey Carter, from the council, said: “We are doing everything we can to support York businesses through these extremely challenging times, and these recommendations reflect that we are doing the same to support Spark, the small businesses which operate in it and of course the many people who work there.
“We have also taken into account the really positive response of Spark to the conditions we set back in very different times in February, in particular achieving planning consent and installing the agreed cladding.”