Hotel, coffee shop and bank are bought by local authority

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PROPERTIES are being bought by a council in a bid to boost its coffers in difficult economic times.

As government grant support for local authorities has dropped dramatically in recent years, East Hampshire District Council is looking at new ways of generating cash.

The Petersfield-based council has now bought The Metro Inn Hotel and adjoining Starbucks coffee shop, off the A3, near Liphook.

It is the council’s third acquisition since deciding to shift its investments from low-interest cash to the high returns in property.

Over the past two years the council has spent £3.7m on its property portfolio – including buying Barclays Bank, in Petersfield Square, and the Co-op store in Four Marks.

The outlay is expected to recoup around £244,000 per year, far outstripping interest rate returns of around £37,000 a year, say council officials.

Councillor Richard Millard, who looks after assets at the authority, said: ‘In the current global economy, property investment brings better returns than cash. We are stepping up our investments to improve our regular income over the long term.

‘As government grants to local councils continue to fall it is ever more important that we can generate our own income to protect our services and keep council tax levels low.’